Labour Mobility: An Adjustment Mechanism in Euroland? Empirical Evidence for Western Germany, France and Italy

Patrick Puhani

German Economic Review, 2001, vol. 2, issue 2, 127-140

Abstract: We evaluate whether labour mobility is likely to act as a sufficient adjustment mechanism in the face of asymmetric shocks in Euroland. As no adequate data on cross-border migration are available, migration elasticities within nation states (Western Germany, France and Italy) are estimated and interpreted as upper bounds for cross-border migration elasticities between European nation states. Labour mobility is highest in Germany, followed by France and Italy. However, the accommodation of a shock to unemployment by migration takes several years. We conclude that labour mobility is unlikely to act as a sufficient adjustment mechanism to asymmetric shocks in Euroland.

Date: 2001
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DOI: 10.1111/1468-0475.00031

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