NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Alessandro Sforza

London School of Economics
Houghton Street
London WC2A 2AE
United Kingdom

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Institutional Affiliation: London School of Economics

NBER Working Papers and Publications

August 2017Goods and Factor Market Integration: A Quantitative Assessment of the EU Enlargement
with Lorenzo Caliendo, Luca David Opromolla, Fernando Parro: w23695
The economic effects from labor market integration are crucially affected by the extent to which countries are open to trade. In this paper we build a multi-country dynamic general equilibrium model with trade in goods and labor mobility across countries to study and quantify the economic effects of trade and labor market integration. In our model trade is costly and features households of different skills and nationalities facing costly forward-looking relocation decisions. We use the EU Labour Force Survey to construct migration flows by skill and nationality across 17 countries for the period 2002-2007. We then exploit the timing variation of the 2004 EU enlargement to estimate the elasticity of migration flows to labor mobility costs, and to identify the change in labor mobility costs ...
 
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