Is a Policy of Free Movement of Workers Sustainable?

Pierre Picard, Tim Worrall

Research output: Working paperDiscussion paper

Abstract

This paper studies the costs and benefits of the adoption of the policy of free movement for workers. For the countries to agree on uncontrolled movement of workers, the short run costs must be outweighed by the long term benefits that result from better labor market flexibility and income smoothing. We show that such policies are less likely to be adopted when workers are impatient and less risk averse workers, when production technologies display decreasing returns and when countries trade a share of their products.
Original languageEnglish
Number of pages37
Publication statusPublished - Mar 2014

Publication series

NameIZA
No.8035

Keywords

  • labor market flexibility
  • migration
  • sustainable plan
  • F22
  • J61

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