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Labor Market Effects of Economic Integration: The Impact of Re‐Unification in German Border Regions

Thiess Buettner and Johannes Rincke ()
Authors registered in the RePEc Author Service: Thiess Büttner ()

German Economic Review, 2007, vol. 8, issue 4, 536-560

Abstract: Abstract. This paper exploits the significant reduction in impediments to labor mobility in the process of German re‐unification in order to identify labor supply shocks in the West German labor market. The focus is on the quasi‐experiment of the border removal in the regions situated at the German–German border that faced a massive increase of cross‐border labor supply. The results indicate that despite a gain in employment, the border removal was accompanied by a decline in wages and an increase in unemployment relative to other West German regions.

Date: 2007
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German Economic Review is currently edited by Bernhard Felderer, Joseph F. Francois, Ivo Welch, Urs Schweizer and David E. Wildasin

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