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EuroCrisisMove SIGNED

Fiscal Consolidation, Unemployment and Labour Mobility in the Euro Area

Total Cost €

0

EC-Contrib. €

0

Partnership

0

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 EuroCrisisMove project word cloud

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decision    employees    members    salaries    greece    policymakers    industrialised    contributed    macroeconomic    intensified    literature    implications    channel    core    aftermath    surge    gap    steep    cuts    triggered    context    wage    stochastic    lens    consolidation    unemployed    welfare    fiscal    fill    world    abroad    policies    restrictions    germany    household    unemployment    allowances    instruments    economies    bill    migration    economic    hikes    peripheral    force    endogenous    policy    public    introduce    equilibrium    decreases    move    deficit    consumption    union    monetary    recruitments    outflows    motivated    area    implements    immigration    notably    employed    perform    socio    benefits    labour    reduce    deterioration    model    career    systematic    unfavourable    links    hit    spain    primarily    countries    income    involve    prospects    search    sizeable    crisis    dynamic    immobile    country    inform    levels    government    tax    mobility    spending    matching    decisions    periphery    frictions    mix    direction   

Project "EuroCrisisMove" data sheet

The following table provides information about the project.

Coordinator
FUNDACIÓ MARKETS, ORGANIZATIONS AND VOTES IN ECONOMICS 

Organization address
address: CAMPUS DE BELLATERRA DE LA UNIVERSIDAD AUTONOMA DE BARCELONA SN EDIFICIO B
city: CERDANYOLA DEL VALLÈS
postcode: 8193
website: www.movebarcelona.eu

contact info
title: n.a.
name: n.a.
surname: n.a.
function: n.a.
email: n.a.
telephone: n.a.
fax: n.a.

 Coordinator Country Spain [ES]
 Total cost 170˙121 €
 EC max contribution 170˙121 € (100%)
 Programme 1. H2020-EU.1.3.2. (Nurturing excellence by means of cross-border and cross-sector mobility)
 Code Call H2020-MSCA-IF-2017
 Funding Scheme MSCA-IF-EF-ST
 Starting year 2018
 Duration (year-month-day) from 2018-09-01   to  2020-08-31

 Partnership

Take a look of project's partnership.

# participants  country  role  EC contrib. [€] 
1    FUNDACIÓ MARKETS, ORGANIZATIONS AND VOTES IN ECONOMICS ES (CERDANYOLA DEL VALLÈS) coordinator 170˙121.00

Map

 Project objective

In the aftermath of the crisis, unfavourable socio-economic conditions with high unemployment, steep decreases in salaries and welfare allowances, and deterioration in career prospects have triggered intensified labour mobility, with a direction from the so-called Peripheral countries to the Core of the euro area. Primarily due to the surge in immigration from its EU partners, Germany is now the second largest immigration country in the industrialised world, after the U.S. Fiscal consolidation policies that aim to reduce deficit levels and typically involve tax hikes and cuts in government spending have also contributed to these migration outflows from crisis-hit countries. Notably, in countries with a sizeable public sector, like Greece and Spain, cuts and restrictions in new recruitments of public employees have further motivated the decision to move abroad. The aim of this research is to theoretically study the macroeconomic links between unemployment, fiscal consolidation, and labour mobility in a monetary union. To this end, I will introduce endogenous migration decisions both for the unemployed and the employed household members in a two-country Dynamic Stochastic General Equilibrium model of a monetary union with search and matching frictions, in which the Periphery implements fiscal consolidation through spending cuts or tax hikes. Existing studies in the fiscal consolidation literature consider an immobile labour force and, therefore, the migration channel has not yet been investigated in this context. This project aims to fill this gap and inform policymakers by comparing different fiscal consolidation instruments: (a) labour income tax hikes, (b) public consumption spending cuts, (c) unemployment benefits cuts, and (d) public sector wage bill cuts. Through the lens of the model, I will also perform a systematic comparison of the implications for different euro area Peripheral economies, which have implemented a different policy mix in the recent years.

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The information about "EUROCRISISMOVE" are provided by the European Opendata Portal: CORDIS opendata.

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