Migration and Regional Adjustment to Asymmetric Shocks in Transition Economies

26 Pages Posted: 17 Apr 2003

See all articles by Jan Fidrmuc

Jan Fidrmuc

Brunel University - Department of Economics and Finance; Centre for Economic Policy Research (CEPR); University of Michigan at Ann Arbor - The William Davidson Institute

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Date Written: February 2003

Abstract

Does migration facilitate regional adjustment to idiosyncratic shocks? The evidence from post-communist economies indicates that the efficacy of migration in reducing inter-regional unemployment and wage differentials has in fact been rather low. High wages appear to encourage - and, similarly, high unemployment tends to discourage - overall migration - inbound and outbound - rather than induce a net flow from depressed regions to those with better economic conditions. Even when the impact of unemployment and wages on net migration is statistically significant, it is economically very small. Finally, migration flows have actually been declining in the course of transition, even as inter-regional disparities have been rising.

Keywords: Migration, regional adjustment, regional shocks, optimum currency areas

JEL Classification: F22, J61, P23

Suggested Citation

Fidrmuc, Jan, Migration and Regional Adjustment to Asymmetric Shocks in Transition Economies (February 2003). CEPR Discussion Paper No. 3798. Available at SSRN: https://ssrn.com/abstract=396140

Jan Fidrmuc (Contact Author)

Brunel University - Department of Economics and Finance ( email )

Uxbridge UB8 3PH
United Kingdom
+44 1895 266 528 (Phone)
+44 1895 269 770 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

University of Michigan at Ann Arbor - The William Davidson Institute

724 E. University Ave.
Wyly Hall
Ann Arbor, MI 48109-1234
United States

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