Schengen Membership - A Door for Emigration? Lessons from the 2007 Enlargement

Abstract

The Schengen project is one of Europe’s most important accomplishments as it facilitates the free movement of goods and people. Currently, Romania and Bulgaria are on the verge of obtaining their Schengen membership and, to our knowledge, not enough emphasis has been placed on the emigration and labour market implications for aspiring candidates. This research aims to empirically evaluate the liaison between Schengen Area and labour migration. To achieve this objective, we construct a difference-in-differences research design using data from the European Labour Force Survey. The treatment is represented by the Schengen enlargement of 2007 with Latvia, Lithuania and Estonia constructing the treatment group and Romania and Bulgaria the control group. The main results show that Schengen Membership led to an increased probability of working abroad one year after treatment occurred, as well as three years after treatment occurred. Also, we can identify the demographic category most likely to emigrate as young males in search of seasonal full-time jobs