Open Borders in the European Union and Beyond: Migration Flows and Labor Market Implications

33 Pages Posted: 17 Jan 2017 Last revised: 24 Jun 2023

See all articles by John Kennan

John Kennan

University of Wisconsin; National Bureau of Economic Research (NBER)

Date Written: January 2017

Abstract

In 2004, the European Union admitted 10 new countries, and wages in these countries were generally well below the levels in the existing member countries. Citizens of these newly-admitted countries were subsequently free to take jobs anywhere in the EU, and many did so. In 2015, a large number of refugees from Syria and other broken countries sought to migrate to EU countries (along very dangerous routes), and these refugees were met with fierce resistance, at least in some places. This paper seeks to understand the labor market implications of allowing free migration across borders, with particular reference to the EU. The aim is to quantify the migration flows associated with EU enlargement, and to analyze the extent to which these flows affected equilibrium wages. The main conclusion is that the real wage effects are small, and the gains from open borders are large.

Suggested Citation

Kennan, John, Open Borders in the European Union and Beyond: Migration Flows and Labor Market Implications (January 2017). NBER Working Paper No. w23048, Available at SSRN: https://ssrn.com/abstract=2900053

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