Is a Policy of Free Movement of Workers Sustainable?

Pierre Picard and Timothy Worrall

No 8035, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper studies the costs and benefits of the adoption of the policy of free movement for workers. For the countries to agree on uncontrolled movement of workers, the short run costs must be outweighed by the long term benefits that result from better labor market flexibility and income smoothing. We show that such policies are less likely to be adopted when workers are impatient and less risk averse workers, when production technologies display decreasing returns and when countries trade a share of their products.

Keywords: migration; labor market flexibility; sustainable plan (search for similar items in EconPapers)
JEL-codes: F22 J61 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2014-03
New Economics Papers: this item is included in nep-int, nep-lab and nep-mig
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Published - published in: Scandinavian Journal of Economics, 2016, 118 (4), 718-75

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Journal Article: Is a Policy of Free Movement of Workers Sustainable? (2016)
Working Paper: Is a policy of free movement of workers sustainable? (2016)
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