Labor Market Laws and Intra-European Migration: The Role of the State in Shaping Destination Choices

Abstract

This article investigates the relationship between migrants' destination choices and the formal labor market access afforded by multiple potential host countries in the context of the EU's eastward enlargement. We use an index of labor market access laws combined with data on migration from new EU member states into the existing states of the EU and EFTA from 2004 through 2010 to test whether (1) migrants are attracted to destinations that give them greater formal labor market access, (2) migration flows to any given destination are influenced by the labor market policies of competing destinations, and (3) the influence of labor market laws on migrant flows is mediated by social networks, language ability, and educational level. Our data support the first two propositions and partly support the third: Migration between origin/destination pairs was positively associated with the loosening of destination labor market restrictions, while negatively associated with the loosening of competing destinations' labor market restrictions. In addition, the influence of destination labor market access appears to be weaker for destinations in which migrants have larger existing co-national networks, and for migrants from countries with languages that are more similar to the destination language, although we do not discern a clear mediating effect of education level. Our models also include variables for a set of economic indicators, social welfare spending, geographic distance, and historical relationships, and the estimated coefficients on these variables are largely in line with theoretical predictions. By combining rich EU data with a unique approach to evaluating competing legal regimes, the analysis helps us better understand how law shapes migration in a multi-destination world.

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