Working Papers

1. Burzyński M., Gola P., Mexican Migration to the US: Selection, Assignment and Welfare [IDEAS], submitted

Abstract: This paper analyzes how migration policy shapes the distribution of wages in sending and destination countries through its impact on migrants’ self-selection. First, we show that if migrants have a worse skill distribution than natives, then the standard assignment model predicts that average-wage-maximization and inequalityminimization goals of policy are in conflict: Any change in migration that worsens the overall skill distribution, increases both the average wage of natives and wage inequality among natives. Second, to quantify the implications of migration policy reforms and trade tariffs, we develop and calibrate a two-country extension of the assignment model with endogenous migration.

2. Burzyński M., Peri G., Natives Sorting and the Impact of Immigration on European Labor Markets

Abstract: We analyze the implications of non-EU immigration for wage distribution and inequality among European workers, by focusing on their migration across local labor markets and within- and across-occupational mobility. To quantify the role of each channel, we build a multi-region, multi-occupation and multi-sector model of labor markets that replicates the regularities of labor mobility across spatial and occupational cells in Europe observed in the data. We find that non-EU immigration increases wages of the majority of European workers, while generating significant sorting across occupations (job upgrading) and inducing negative self-selection of natives into inactivity. The overall level of income inequality rises (especially the between-occupation component), fueled by natives' mobility across jobs. The sorting of native workers across regions induced by immigration is of lesser importance for welfare and inequality, but shapes the spatial distribution of overall effects.  

3. Burzyński M., Spatial and Occupational Mobility of Workers Due to Automation

Abstract: Automation of labor tasks is one of the most dynamic aspects of recent technological progress. This paper aims at improving our understanding of the way that automation affects labor markets, analyzing the example of European countries. The quantitative theoretical methodology proposed in this paper allows to focus on automation-induced migration of workers, occupation switching and income inequality. The key findings include that automation in the first two decades of the 21st century had a significant impact on job upgrading of native workers and generated gains in many local labor markets. Even though net migration of workers was attenuated due to convergence in incomes across European regions, mobility at occupation levels had a sizeable impact on transmitting welfare effects of automation.

4. Burzyński M., Kudashev R., Verheyden  B., Trading Miles for Rents: A Radiation Model of Cross-Border Commuting and Residential Location

Abstract: This paper develops a spatial equilibrium model to analyze commuting and residence decisions in a setting that incorporates labor and housing markets. Our analysis illuminates how local labor markets in the Greater Region interact with commuting externalities and localized housing constraints, highlighting policy trade-offs for balanced regional development. With a help of the proposed modified radiation model that emulates individuals' job finding decisions, we analyze the way in which traveling time shapes the regional distribution of commuting. Our main findings show that removing commuting congestion in Luxembourg raises overall utility levels, but at the cost of higher income inequality. White-collar workers turn to cross-border commuting and indirectly boost local economies in peripheral cities in France.

5. Burzyński M., Cha'ngom N., Ozden C., Szymańska A., Education as an Adaptation Policy against Climate-Induced Poverty

Abstract: This paper discusses education policies as a way of addressing climate-driven poverty, inequality, and migration. By building a spatial general equilibrium model of the world economy with heterogeneous agents, we quantify the implications of a Targeted Education Policy for the poorest populations vulnerable to climate damage. By equipping individuals, whose descendants will live in areas subject to severe climate hazards in 2090, with more education attainment, the proposed policy empowers today's communities under future climate risk with capability to adjust and alleviate future climate damages. We find that, within the framework of our model, the targeted policy outperforms policies based on a uniform provision of education in terms of standard measures of income, (extreme) poverty and investment efficiency. The key insight of our theoretical experiment calls for further investigation of targeted policies, especially in the context of climate change.

6. Burzyński M., Machado J., The effect of climate policies on the spatial allocation of workers and production in Europe

Abstract: In this paper, we develop a general equilibrium model that allows for occupational sorting of workers and migration as an adaptation channels to changes in environmental taxation. We quantify the regional effects of an EU-wide increase in CO2 emission prices on the location of occupations, production, and workers across 100 European regions. We find shifts of employment from the manufacturing and construction sectors towards the services sectors. Unsurprisingly, regions specialized in high-emission sectors suffer the most from higher taxes. We then analyze to what extent redistributing taxes i) uniformly across the EU or ii) uniformly within a country affects workers' welfare and inequality across the EU.