Labor Supply Shocks and the Beveridge Curve: Empirical Evidence from EU Enlargement

Review of Economic Dynamics, 2021, vol. 40, 108-127

Abstract: Labor supply shocks can have substantial effects on the Beveridge Curve. Structural VARs with sign restrictions show that the shocks associated with the free movement of workers from Eastern Europe have temporarily increased unemployment in Austria, a major destination country, by 25% and job vacancies by 40%. The 2% increase in total employment was accompanied by a temporary decline in the employment of domestic workers. The greatest impact is seen in regions bordering on the home countries of the migrant workers. Beyond these findings the paper addresses empirical regularities of labor supply shocks that are at odds with theoretical predictions. (Copyright: Elsevier)

Keywords: Labor supply shocks; Beveridge Curve; Job-related migration; Sign restrictions; Structural VAR (search for similar items in EconPapers)
JEL-codes: C32 F66 J21 J63 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (6)

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DOI: 10.1016/j.red.2020.09.005

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