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Migration as an Adjustment Mechanism in the Crisis? A Comparison of Europe and the United States

Julia Jauer, Thomas Liebig (), John Martin () and Patrick Puhani
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Julia Jauer: OECD

No 155, OECD Social, Employment and Migration Working Papers from OECD Publishing

Abstract: The question of whether migration can be an equilibrating force in the labour market is an important criterion for an optimal currency area. It is of particular interest currently in the context of high and rising levels of labour market disparities, in particular within the Eurozone where there is no exchange-rate mechanism available to play this role. We shed some new light on this question by comparing pre- and post-crisis migration movements at the regional level in both Europe and the United States, and their association with asymmetric labour market shocks. We find that recent migration flows have reacted quite significantly to the EU enlargements in 2004 and 2007 and to changes in labour market conditions, particularly in Europe. Indeed, in contrast to the pre-crisis situation and the findings of previous empirical studies, there is tentative evidence that the migration response to the crisis has been considerable in Europe, in contrast to the United States where the crisis and subsequent sluggish recovery were not accompanied by greater interregional labour mobility in reaction to labour market shocks. Our estimates suggest that, if all measured population changes in Europe were due to migration for employment purposes – i.e. an upper-bound estimate – up to about a quarter of the asymmetric labour market shock would be absorbed by migration within a year. However, in the Eurozone the reaction mainly stems from migration of third-country nationals. Even within the group of Eurozone nationals, a significant part of the free mobility stems from immigrants from third countries who have taken on the nationality of their Eurozone host country. La question de savoir si la migration peut être une force d'équilibre sur le marché du travail est un critère non négligeable pour l’optimisation d’une zone monétaire. Elle est particulièrement importante dans un contexte où les disparités du marché du travail connaissent des niveaux élevés et croissants, en particulier au sein de la zone euro où il n'existe pas de mécanisme de taux de change à même de jouer ce rôle. Nous espérons apporter un éclairage nouveau sur cette question en comparant les flux migratoires avant et après la crise au niveau régional en Europe et aux États-Unis , et leur combinaison avec les chocs asymétriques du marché du travail. Nous avons constaté que les flux migratoires récents ont réagi de manière assez significative aux élargissements de l'UE en 2004 et 2007 et aux changements du marché du travail, en particulier en Europe. En effet, contrairement à la situation qui prévalait avant la crise et aux résultats des études empiriques antérieures, il semblerait que la réponse de la migration à la crise ait été considérable en Europe, contrairement aux États-Unis où la crise et la faible reprise ultérieure n'ont pas été accompagnées par une plus grande mobilité interrégionale des travailleurs en réaction aux chocs du marché du travail. Nos estimations semblent suggérer que si tous les changements de population mesurés en Europe sont dus à la migration à des fins d'emploi - c'est à dire une estimation de la limite supérieure - jusqu'à environ un quart des chocs asymétriques du marché du travail seraient absorbés par la migration dans l'année. Cependant, dans la zone euro, cette réaction s'explique principalement par la migration de ressortissants de pays tiers. Même au sein du groupe des ressortissants de la zone euro, une partie importante des mouvements de libre circulation émanent de migrants de pays tiers ayant pris la nationalité de leur pays d'accueil de la zone euro.

Keywords: economic crisis; Europe; Eurozone; free mobility; labour market adjustments; migration; United States (search for similar items in EconPapers)
JEL-codes: F15 F16 F22 J61 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eec, nep-lab and nep-mig
Date: 2014-01-09
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https://doi.org/10.1787/5jzb8p51gvhl-en (text/html)

Related works:
Working Paper: Migration as an adjustment mechanism in the crisis? A comparison of Europe and the United States (2014) Downloads
Working Paper: Migration as an adjustment mechanism in the crisis? A comparison of Europe and the United States (2014) Downloads
Working Paper: Migration as an Adjustment Mechanism in the Crisis? A Comparison of Europe and the United States (2014) Downloads
Working Paper: Migration as an Adjustment Mechanism in the Crisis? A Comparison of Europe and the United States (2014) Downloads
Working Paper: Migration as an Adjustment Mechanism in the Crisis? A Comparison of Europe and the United States (2014) Downloads
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