Labor Mobility in an Enlarged European Union

50 Pages Posted: 21 Apr 2012

See all articles by Martin Kahanec

Martin Kahanec

IZA Institute of Labor Economics; Central European University; Central European Labour Studies Institute

Abstract

The 2004 and 2007 enlargements of the EU extended the freedom of movement to workers from the twelve new member states mainly from Central Eastern Europe. This study summarizes and comparatively evaluates what we know about mobility in an enlarged Europe to date. The pre-enlargement fears of free labor mobility proved to be unjustified. No significant detrimental effects on the receiving countries’ labor markets have been documented, nor has there been any discernible welfare shopping. Rather, there appear to have been positive effects on EU’s productivity. The sending countries face some risks of losing their young and skilled labor force, but free labor mobility has relieved them of some redundant labor and the associated fiscal burden. They have also profited from remittances. Of key importance for the sending countries is to reap the benefits from brain gain and brain circulation in an enlarged EU. For the migrants the benefits in terms of better career prospects have with little doubt exceeded any pecuniary and non-pecuniary costs of migration. In conclusion, the freedom of movement in the EU provides for a triple-win situation for the receiving and sending countries as well as for migrants themselves, provided the risks are contained and efficient brain circulation is achieved.

Keywords: EU labor markets, migration, EU enlargement, labor mobility, free movement of workers, transitional arrangements, new member states, European Union

JEL Classification: F22, J61

Suggested Citation

Kahanec, Martin, Labor Mobility in an Enlarged European Union. IZA Discussion Paper No. 6485. Available at SSRN: https://ssrn.com/abstract=2043487

Martin Kahanec (Contact Author)

IZA Institute of Labor Economics ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Central European University ( email )

Nador utca 9
Budapest, H-1051
Hungary

Central European Labour Studies Institute ( email )

Zvolenská 29
Bratislava, 82109
Slovakia

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