Abstract
The free movement of workers within the EU is one of the fundamental pillars of the EU single market. The policy has been introduced to remove barriers to the functioning of the integrated market and improve the matching of labor supply and demand. While the free mobility of labor can be expected to raise potential growth in Europe in the long run, there have been concerns regarding the short-term impacts of the sudden opening of labor markets in the existing member states to the arrivals from the joining countries.
The authors thank the anonymous referee as well as the editors of this volume for providing a number of suggestions that helped to improve the chapter significantly. We remain responsible for any mistakes still present. Some results of the analysis presented in this paper were generated as part of the project “Labour mobility within the EU – the impact of enlargement and the functioning of transitional arrangements” commissioned by the European Commission.
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Notes
- 1.
Unanticipated migration is generally associated with a temporary rise in the unemployment rate and downward pressure on wages, as the labour market adjusts to the shock. Whereas anticipated migration will already be factored into labour force projections and firm investment plans, and will generally not entail these short-term adjustment patterns.
- 2.
With the exception of Luxembourg, which we cannot separately identify within the modelling framework we adopt. Total inflows from the EU-8 into Luxembourg over the period 2004–2009 amounted to about 1.3 % of the Luxembourg population, in relative terms similar to the flows to the UK. We could therefore make the assumption that the long-run macro-economic impact in Luxembourg has been roughly the same in terms of magnitude as in the UK.
- 3.
The model we are working with does not explicitly measure wages in the other countries covered by this study and so we also cannot calculate the impact on aggregate EU-8 wages. The biggest impacts can be expected in countries with the biggest short-term shifts in the unemployment rate.
- 4.
The impact of migration from Bulgaria and Romania on GDP in Germany and Finland is practically negligible. Since the migration inflows are very small relative to host countries populations, the relative weight of the competitiveness effect is bigger than that of the productive capacity effect.
- 5.
“Potential” migration determined by structural factors.
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Acknowledgements
Some results of the analysis presented in this paper were generated as part of the project “Labour mobility within the EU – the impact of enlargement and the functioning of transitional arrangements” commissioned by the European Commission (contract VC/2010/1159). The views and opinions expressed in this publication are those of the authors and do not necessarily represent those of the European Commission. We thank participants of IZA seminars in Budapest for helpful comments.
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Fic, T., Holland, D., Paluchowski, P., Portes, J. (2016). The Redistributive Impacts of Migration After the EU’s Eastern Enlargement. In: Kahanec, M., Zimmermann, K.F. (eds) Labor Migration, EU Enlargement, and the Great Recession. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-662-45320-9_2
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