The influence of wage and unemployment differentials on labour mobility in the EU: a meta-analysis

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Description/Abstract

This paper reviews the empirical literature on the impact of wage and unemployment differentials on the mobility of labour in the European Union. We calculated comparable elasticities for 26 empirical studies. The mean elasticity in the literature is quite small; around +0.4 for wage and -0.15 for unemployment differentials. A 1%-point rise in the host-country wage therefore raises the flow of in-migrants in that country by 0.4%. There exists substantial variation across studies, however. By performing a meta-analysis, the paper aims to explain this variation by the differences in characteristics of the underlying studies. Systematic differences are found with respect to the size of the regions and the specific country that is considered.