How does economic integration influence employment and wages in border regions? The case of the EU-enlargement 2004 and Germany’s eastern border

Nils Braakmann and Alexander Vogel

No 142, Working Paper Series in Economics from University of Lüneburg, Institute of Economics

Abstract: This paper considers the (short run) employment and wage effects of the 2004 EUenlargement on firms located close to Germany’s Eastern border. We use a 50% sample of Germans plants and apply difference-in-differences-estimators combined with a matching approach. We evaluate changes in total employment, the employment shares of low-skilled and Eastern European workers and the wages for low-skilled, skilled and high-skilled workers in various sectors. Our results suggest negative (short-run) effects of the EU-enlargement on employment in construction and the business services sector, where we also find negative wage effects. Wages and employment in manufacturing, wholesale and retail trade, hotels and restaurants and social and personal service activities seem to have been relatively less affected.

Keywords: EU-enlargement; economic integration; employment; wages (search for similar items in EconPapers)
JEL-codes: F15 L80 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2009-09
New Economics Papers: this item is included in nep-eur and nep-tra
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Journal Article: How does economic integration influence employment and wages in border regions? The case of the EU enlargement 2004 and Germany’s eastern border (2011)
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