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Education, Unemployment and Migration

Author

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  • Wolfgang Eggert
  • Tim Krieger
  • Volker Meier

Abstract

This paper studies a two-region model in which unemployment, education decisions and interregional migration are endogenous. The poorer region exhibits both lower wages and higher unemployment rates, and migrants to the richer region are disproportionally skilled. The brain drain from the poor to the rich region is accompanied by stronger incentives to acquire skills even for immobile workers. Regional shocks tend to affect both regions in a symmetric fashion, and skilled-biased technological change reduces wages of the unskilled. Both education and migration decisions are distorted by a uniform unemployment compensation, which justifies a corrective subsidization.

Suggested Citation

  • Wolfgang Eggert & Tim Krieger & Volker Meier, 2007. "Education, Unemployment and Migration," CESifo Working Paper Series 2119, CESifo.
    • Handle: RePEc:ces:ceswps:_2119
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    3. Alexander Haupt & Tim Krieger & Thomas Lange, 2010. "A Note on Brain Gain and Brain Drain: Permanent Migration and Education Policy," Working Papers CIE 27, Paderborn University, CIE Center for International Economics.
    4. Alexander Haupt & Tim Krieger & Thomas Lange, 2016. "Competition for the international pool of talent," Journal of Population Economics, Springer;European Society for Population Economics, vol. 29(4), pages 1113-1154, October.
    5. Dragomirescu-Gaina, Catalin & Weber, Anke, 2013. "Forecasting the Europe 2020 headline target on education and training: A panel data approach," MPRA Paper 68664, University Library of Munich, Germany.
    6. Tim Krieger & Thomas Lange, 2010. "Education policy and tax competition with imperfect student and labor mobility," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 17(6), pages 587-606, December.
    7. Tina Dulam & Philip Hans Franses, 2015. "Emigration, wage differentials and brain drain: the case of Suriname," Applied Economics, Taylor & Francis Journals, vol. 47(23), pages 2339-2347, May.
    8. Łukasz Byra, 2023. "Two possible reasons behind the reluctance of low-skilled workers to migrate to generous welfare states," Working Papers 2023-24, Faculty of Economic Sciences, University of Warsaw.
    9. Patrice Pieretti & Giuseppe Pulina & Skerdilajda Zanaj, 2024. "Fiscal competition and two-way migration," BCL working papers 183, Central Bank of Luxembourg.
    10. Henrietta Nyamnjoh, 2021. "Ambitions of Bushfalling through Further Education: Insights from Students in Cameroonian Universities," Social Inclusion, Cogitatio Press, vol. 9(1), pages 196-206.
    11. Patrice Pieretti & Giuseppe Pulina & Andreas Sintos & Skerdilajda Zanaj, 2024. "Fiscal Competition and Migration Patterns," DEM Discussion Paper Series 24-04, Department of Economics at the University of Luxembourg.
    12. Youngjin Woo & Min Jiang & Euijune Kim, 2021. "Analyzing return migration of high school graduates from lagging regions," Letters in Spatial and Resource Sciences, Springer, vol. 14(3), pages 309-319, December.
    13. Dulam, T.W. & Franses, Ph.H.B.F., 2014. "Microeconomic determinants of skilled migration: The case of Suriname," Econometric Institute Research Papers EI 2014-21, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
    14. Alexander Kemnitz, 2009. "Native welfare losses from high skilled immigration," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 16(4), pages 560-570, August.
    15. Hana STOJANOVÁ & Pavel TOMŠÍK, 2014. "Factors influencing employment for tertiary education graduates at the selected universities," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 60(8), pages 376-387.
    16. Kotorri Mrika, 2017. "The probability of return conditional on migration duration: evidence from Kosovo," South East European Journal of Economics and Business, Sciendo, vol. 12(2), pages 35-46, December.
    17. Wasim Qazi & Syed Ali Raza & Arshian Sharif, 2017. "Higher Education Development and Unemployment in Pakistan: Evidence from Structural Break Testing," Global Business Review, International Management Institute, vol. 18(5), pages 1089-1110, October.
    18. Wajahat Ali Ghulam & Waqas Ali* & Shujahat Ali & Muhammad Masood Khan & Raja Nasir Ali Khan & Muhammad Farooq, 2019. "Investigating Factors Influencing Brain Drain of Citizens of Azad Kashmir Pakistan," The Journal of Social Sciences Research, Academic Research Publishing Group, vol. 5(3), pages 782-788, 03-2019.
    19. Dreher, Axel & Krieger, Tim & Meierrieks, Daniel, 2011. "Hit and (they will) run: The impact of terrorism on migration," Economics Letters, Elsevier, vol. 113(1), pages 42-46, October.
    20. Camilo Alberto Cárdenas Hurtado & María Alejandra Hernández Montes & Jhon Edwar Torres Gorron, 2014. "An Exploratory Analysis of Heterogeneity on Regional Labour Markets and Unemployment Rates in Colombia: An MFACT approach," Borradores de Economia 802, Banco de la Republica de Colombia.
    21. Gega Todua, 2017. "Financing Education Abroad: A Developing Country Perspective," CERGE-EI Working Papers wp608, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    22. Alexander Haupt & Silke Übelmesser, 2014. "Labour Market Integration, Human Capital Formation, and Mobility," Jena Economics Research Papers 2014-020, Friedrich-Schiller-University Jena.
    23. Volker Meier, 2010. "Programmauswahl in der aktiven Arbeitsmarktpolitik durch Selbstbeteiligung?," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 63(17), pages 27-29, September.
    24. Zhao, Yu & Du, Hui & Li, Rui & Zhou, Guangsu, 2024. "The long-term influence of education resources allocation on the migration: Evidence from the China’s rural school consolidation policy," Journal of Asian Economics, Elsevier, vol. 91(C).

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    More about this item

    Keywords

    education; unemployment; interregional migration; externalities; brain drain;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • I20 - Health, Education, and Welfare - - Education - - - General
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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