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Do the Best Go West? An Analysis of the Self-Selection of Employed East-West Migrants in Germany

Author

Listed:
  • Brücker, Herbert

    (Institute for Employment Research (IAB), Nuremberg)

  • Trübswetter, Parvati

    (Institute for Employment Research (IAB), Nuremberg)

Abstract

Since the inequality of earnings in East Germany has approached West German levels in the late 1990s, the standard Roy model predicts that a positive selection bias of East-West migrants should disappear. Using a switching regression model and data from the IABemployment sample, we find however that employed East-West migrants remain positively self-selected with respect to unobserved abilities. This result is consistent with the predictions of our extended Roy model which considers moving costs that are negatively correlated with labour market abilities of individuals. Moreover, we find that wage differentials as well as differences in employment opportunities are the central forces which drive East-West migration after unification.

Suggested Citation

  • Brücker, Herbert & Trübswetter, Parvati, 2004. "Do the Best Go West? An Analysis of the Self-Selection of Employed East-West Migrants in Germany," IZA Discussion Papers 986, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp986
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    References listed on IDEAS

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    More about this item

    Keywords

    self-selection; East Germany; migration;
    All these keywords.

    JEL classification:

    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • P23 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Factor and Product Markets; Industry Studies; Population

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