Labour Supply and Incentives to Work in Europe

Labour Supply and Incentives to Work in Europe

Edited by Ramón Gómez-Salvador, Ana Lamo, Barbara Petrongolo, Melanie Ward and Etienne Wasmer

Labour Supply and Incentives to Work in Europe highlights recent developments in the labour supply in Europe and gives a detailed assessment of their link with economic policies and labour market institutions. Despite major changes in European labour supply during the past few decades, the existing literature still lacks a comprehensive study of the relationship between labour supply and labour market institutions from a macro perspective.


Herbert Bru_cker

Subjects: economics and finance, labour economics


Herbert Brücker On 1 May 2004, the European Union (EU) admitted ten new Member States1 with a joint population of 74.1 million. Two more, Bulgaria and Romania, are scheduled to join in 2006. These two enlargement rounds will increase the total population of the EU by 103.6 million and the European labour force by some 45 million (Eurostat, 2004). In 2002 the per-capita GDP of the ten Central and Eastern European accession countries (CEEC-10) was approximately 20 per cent of the EU-15 average at current exchange rates and approximately 45 per cent in purchasing power parities (Eurostat, 2003). Against this background, two questions have attracted increasing attention in the public debate on the economic consequences of Eastern enlargement: first, will removing migration barriers result in mass migration from Eastern to Western Europe? Second, how will increasing migration affect labour markets in an enlarged EU? In this contribution I will discuss these two questions in the context of recent research findings that reassess the estimates of migration potentials and evaluate the potential effects of migration on European labour markets. The Scale of Migration: What Do We Know? What Don’t We Know? Starting with the seminal contribution of Layard et al. (1992), numerous studies have tried to estimate East–West migration potential.2 Basically we can distinguish three approaches in the literature: representative surveys, extrapolations of South–North migration to East–West migration, and forecasts based on multivariate econometric studies. Representative surveys of the Eastern European population have three disadvantages,...

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