Research Papers in Economics, Department of Economics, Stockholm University
What We Cannot Learn from the Irish Experience: A fundamental Asymmetry of Asymmetric Shocks
() and Rikard Forslid
Abstract: A simple N-country specific-factor model with imperfectly
mobile labour is developed. It is shown that effects of country-specific
productivity shocks hitting a small country are fundamentally asymmetric. A
positive shock will be accomodated by a moderate wage increase and sizable
in-migration, whereas a negative shock will be accomodated by a significant
decrease in wages and moderate out-migration. The effects of shocks in a
monetary union are discussed, and it is argued that the results are
consistent with the recent Irish experience. The welfare effects of small
economics fluctuations are also discussed.
Keywords: migration; assymmetric shocks; (follow links to similar papers)
JEL-Codes: E24; F22; (follow links to similar papers)
14 pages, August 11, 2000
Before downloading any of the electronic versions below
you should read our statement on
for viewing Postscript files and the
Acrobat Reader for viewing and printing pdf files.
Full text versions of the paper:
Questions (including download problems) about the papers in this series should be directed to Sten Nyberg ()
Report other problems with accessing this service to Sune Karlsson ()
or Helena Lundin ().
Design by Joachim Ekebom