Labor Market Effects of Economic Integration: The Impact of Re-Unification in German Border Regions |
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Authors: | Thiess Buettner Johannes Rincke |
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Affiliation: | Ifo Institute and Ludwig-Maximilians-University Munich |
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Abstract: | Abstract. This paper exploits the significant reduction in impediments to labor mobility in the process of German re-unification in order to identify labor supply shocks in the West German labor market. The focus is on the quasi-experiment of the border removal in the regions situated at the German–German border that faced a massive increase of cross-border labor supply. The results indicate that despite a gain in employment, the border removal was accompanied by a decline in wages and an increase in unemployment relative to other West German regions. |
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Keywords: | J61 R23 F15 |
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