19 juin 2023
Ecrit par WID.world

Trading non-tradables: the implications of Europe’s job posting policy

This paper examines the impacts of the EU posting policy, a large trade and temporary migration program facilitated by the free provision of services. The collection of findings outline four main lessons.

  1. Trade in goods and services and conventional capital and labor flows were insufficient to integrate labor markets within the EU
  2. There is enough wage rigidity in receiving countries so that firms can set wages for posted workers below those of comparable domestic workers. As a result, increasing trade in factors leaves domestic wages unchanged but leads to domestic employment responses in the more exposed segments of receiving labor markets
  3. The posting arrangement allows sending country firms to capture part of the gains to immigration from receiving country firms and migrants themselves
  4. While the posting policy fostered international integration in formerly non-tradable sectors, the resulting temporary migration flows are still too small to eliminate wage differences between countries.


  • Mathilde Muñoz, James M. and Cathleen D. Stone Center on Wealth and Income Inequality, UC Berkeley, United States


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