Unless labour force participation in Europe increases enormously in the coming decades, the current demographic dynamics will
pose gigantic challenges to the sustainability of public finance. Migration (and thus migration policy) can thus be seen as
a central topic which will remain on top of the policy agenda. The aim of this policy brief is to summarise the knowledge
gained by the research efforts on this issue in the framework of WWWforEurope and to provide policy makers with new methods
and research results which will allow them to better quantify the effects of policy changes.
Wilfried Altzinger, Jesús Crespo Cuaresma, Alyssa Schneebaum (WU Wien), Bernhard Rumplmaier, Petra Sauer (WIFO)
The persistence of socioeconomic outcomes across generations acts as a barrier to a society's ability to exploit its resources
efficiently. In order to derive policy measures which aim at accelerating intergenerational mobility, we review the existent
body of research on the causes, effects and the measurement of intergenerational mobility. We also present recent empirical
works which study intergenerational mobility in Europe, around the globe, and its relevance for economic growth. We recommend
four policy measures to reduce the negative impacts of intergenerational persistence in economic outcomes: universal and high-quality
child care and pre-school programmes; later school tracking and increased access to vocational training to reduce skill mismatch
and facilitate technological development; integration programmes for migrants; and simultaneous investment in schooling and
later social security programmes.
We use new migration modelling and projection techniques in order to quantify the effect of migration in the context of ageing
societies in Europe over the forthcoming decades. Using new empirical results, data and projections of migration flows developed
in the framework of the WWWforEurope project, we inform the policy discussion concerning the role of demographic change, inequality
dynamics, labour market integration of migrants and the sustainability of public finances in the continent.
We construct a new dataset of inequality in educational attainment by age and sex at the global level. The comparison of education
inequality measures across age groups allows us to assess the effect of inter-generational education attainment trends on
economic growth. Our results indicate that countries which are able to reduce the inequality of educational attainment of
young cohorts over time tend to have higher growth rates of income per capita. This effect is additional to that implied by
the accumulation of human capital and implies that policies aiming at providing broad-based access to schooling have returns
in terms of economic growth that go beyond those achieved by increasing average educational attainment.
We present a method aimed at estimating global bilateral migration flows and assessing their determinants. We employ that
fact that available net migration figures for a country are (nonlinear) aggregates of migration flows from and to all other
countries of the world in order to construct a statistical model that links the determinants of (unobserved) migration flows
to total net migration. Using simple specifications based on the gravity model for international migration, we find that migration
flows can be explained by standard gravity model variables such as GDP differences, distance or bilateral population. The
usefulness of such models is exemplified by combining estimated specifications with population and GDP projections in order
to assess quantitatively the expected changes in migration flows to Europe in the coming decades.
We assess empirically the vertical price transmission mechanism between producer and consumer prices of milk products in Austria
using monthly data for the period from January 1996 to February 2010. We consider explicitly the existence of asymmetries
in the adjustment to the long-run equilibrium using two different types of threshold vector error correction (VEC) models,
where an inaction band in the adjustment to the long-run relationship is defined and alternatively where price dynamics differ
between periods of increasing and decreasing trends in causal prices. Our results indicate that asymmetries play an important
role in the pass-through of prices of milk products in Austria. We provide statistical evidence concerning the fact that the
adjustment only tends to take place when deviations from the equilibrium are large enough. Milk, dairy and cheese products
and butter tend to remain in positive margins (measured as deviations from the long-run equilibrium) for the retailers' side.
The explicit modelling of non-linearities does not improve out-of-sample forecasting performance.