Economics, Econometrics and Finance
4 years ago

EU Enlargement Boosts Welfare for New Member States, Especially Unskilled Labor.

SSRN Electronic Journal
Goods and Factor Market Integration: A Quantitative Assessment of the EU Enlargement
Lorenzo Caliendo, Luca David Opromolla, Fernando Parro, Alessandro Sforza

Paper Summary

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The article examines how trade and labor market integration in the EU affects economic outcomes. By using a model that considers trade costs and migration patterns, the researchers found that new EU member states, especially unskilled labor, benefited the most from the EU enlargement. Without changes to trade policy, existing EU countries would have been worse off after the enlargement. The study emphasizes the importance of trade in understanding the welfare and migration effects of labor market integration.