Labor Market Effects of Economic Integration - The Impact of Re-Unification in German Border Regions
Thiess Büttner () and
Johannes Rincke ()
No 1179, CESifo Working Paper Series from CESifo
The paper argues that economic integration causes problems for the labor market of high-wage countries due to cross-border labor mobility and the accompanying increase in labor supply. Empirical evidence is provided from an analysis of regional labor market effects of German re-unification. In the aftermath of the re-unification shock, despite some gain in employment, border regions situated on the former German-German border are found to have experienced a fall in the relative wage position and an increase in unemployment relative to other West-German regions. As this points to adverse labor supply effects for resident workers due to cross-border labor mobility, this result is bad news for EU regions situated on the border with the Accession countries in Central and Eastern Europe.
Keywords: economic integration; border regions; EU enlargement; German re-unification; differences in differences estimation (search for similar items in EconPapers)
JEL-codes: F15 J61 R23 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eec, nep-geo, nep-lab and nep-tra
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Journal Article: Labor Market Effects of Economic Integration: The Impact of Re‐Unification in German Border Regions (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_1179
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