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European integration, labour market dynamics and migration flows

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  • Martinoia, Michela

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Abstract

This paper has a double goal. On one side we want to evaluate the effect of economic integration on migration flows moving from the enlargement countries towards the EU-15; on the other, we want to analyse whether the migration flows had any impact over employment, real wages and labour force in the receiving countries of the European labour market. Due to the fact that economic integration can be observed in different real, monetary and financial phenomena, we refer to three of these to measure integration: trade openness, trade integration and financial market integration. These indicators have been inserted in a theoretical model that tries to explain labour market dynamics. The theoretical context that seemed the most suitable one to summarise European labour market characteristics is a modified version of the insider/outsider model proposed by Layard, Nickell and Jackman (LNJ, 1991). Another innovative contribution is the introduction of an equation modelling migration flows, whose creation is inspired to the neo-classic approach to the migration theory (Harris-Todaro, 1970). The model based on rational expectations is solved to find the equilibrium solution and the impact multipliers. Subsequently we estimated a structural VAR with the aim of both evaluating the impact that different shocks on integration measures have on migration flows, and measuring the type of effects that an increase in migration flows causes on the labour market. The estimates show that economic integration generate relevant effects on migration flows from the enlargement countries towards the EU-15 countries. Moreover, from the results emerge that migration flows generate an effect on the labour market.

Suggested Citation

  • Martinoia, Michela, 2009. "European integration, labour market dynamics and migration flows," POLIS Working Papers 136, Institute of Public Policy and Public Choice - POLIS.
  • Handle: RePEc:uca:ucapdv:136
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    References listed on IDEAS

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    Cited by:

    1. Mihi-Ramírez Antonio & García Rodríguez Yolanda & Metelski Dominik, 2015. "Economic Factors Concerning The Migration Of The Best Educated Workers. The Case Of College Teachers / Wpływ Czynników Ekonomicznych na Migrację Pracowników z Wysokimi Kwalifikacjami. Przykład Pracown," Comparative Economic Research, De Gruyter Open, vol. 18(4), pages 99-122, December.
    2. Marchese Carla & Ramello Giovanni B., 2011. "In the Beginning Was the Word. Now is the Copyright," Review of Law & Economics, De Gruyter, vol. 7(1), pages 271-289, October.

    More about this item

    Keywords

    European economic integration; labour market effects; migration;

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • F15 - International Economics - - Trade - - - Economic Integration
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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