Open Borders, Transport Links, and Local Labor Markets

Abstract

This article examines the labor-market impact of opening borders to low-wage countries, exploiting time and regional variation provided by the 2004 EU enlargement in combination with transport links to Sweden from new member states. Results suggest an adverse impact on earnings of present workers in the order of 1 percent in areas close to pre-existing ferry lines. Effects are present in most segments of the labor market but tend to be greater in groups with weaker positions. The impact is also clearer in industries that have received more workers from new member states and for which cross-border work is likely to be more common. There is no robust evidence for an impact on employment or wages. We discuss the potential mechanisms driving these results.

Retrospective causal inference via matrix completion, with an evaluation of the effect of European integration on cross-border employment

“…We apply this framework to evaluate the effect of two key European institutions, namely the Schengen Agreement and the Freedom of Movement, on cross-border employment in Europe. While previous literature has studied the labour market effects of these institutions on natives in the host regions (Naguib, 2019;Basten and Siegenthaler, 2019;Aepli and Kuhn, 2019;Åslund and Engdahl, 2019;Beerli et al, 2020), our analysis focuses on sending regions.…”

“…However, studies on the effects of these institutions on cross-border employment of sending regions are scarce. Most of the literature has focused on their effects on migration (e.g., Elsner, 2013;Beine et al, 2019), trade integration (Chen and Novy, 2011;Davis and Gift, 2014;Felbermayr et al, 2018), cross-regional labour market correlations (Bartz and Fuchs-Schündeln, 2012), labour market outcomes of natives in the host regions (Naguib, 2019;Basten and Siegenthaler, 2019;Aepli and Kuhn, 2019;Åslund and Engdahl, 2019;Beerli et al, 2020), and criminality (Sandner and Wassmann, 2018).…”

‘Crowded out’? Immigration Surge and Residents’ Employment Outcomes in Norway

“…After the EU extension in 2004, labor immigrants to Sweden from Baltic countries typically entered areas close to the harbors of Baltic Sea ferry lines. Low-skilled natives who lived in these areas experienced relatively negative wage developments (Aslund & Engdahl 2019).…”

Crossing Borders: Labor Market Effects of European Integration

“…Most existing studies concentrate on the impact of immigration on destination countries, often in specific industries such as construction (e.g. Kuosmanen and Meriläinen, forthcoming;Bratsberg et al, forthcoming;Åslund and Engdahl, 2019;Schmieder and Weber, 2018;Lemos and Portes, 2014). Hammer and Hertweck (2022) is a comparable study for Germany, which shows how immigration after 2011 a ected native workers' wages and employment.…”