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Heijdra, Ben J.
Keuschnigg, Christian
Kohler, Wilhelm
Year of Publication: 
Series/Report no.: 
CESifo Working Paper 718
Eastern enlargement of the EU promises gains, but also imposes fiscal costs on incumbent countries. A sensitive issue concerns immigration, jobs and wages. We address these issues in a general equilibrium framework, both analytically and through numerical simulations. Analytical results identify capital accumulation as a prime transmission channel. Using a dynamic CGE model with search unemployment of high- and low-skilled labor, we simulate the effects of enlargement on Germany finding small e.ects from trade, but more pronounced labor market e.ects from migration. Based on German model elasticities, we approximate expected benefits and costs for other member countries as well.
EU enlargement
economic integration
economic growth
capital accumulation
search unemployment
computable general equilibrium analysis
Document Type: 
Working Paper

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