Migration and the EU Labour Market: Granger Causality Tests on a Panel VAR

This paper investigates the interaction between migration and the European Union (EU) labour market. The study runs Granger causality tests using panel data on 13 of the original EU countries. As predicted by theory, the modelling unveils a negative relationship among unemployment and migration. However, real wages and immigration appear to remain independent. These findings imply that migration flows have had little significant adverse impact on the EU labour market.