It is often argued that tax competition may lead to a 'race to the bottom'. This result may indeed hold in the case of factor mobility (such as capital). However, in this paper we emphasize the unique feature of labor migration, that may nullify the 'race to the bottom' hypothesis. Labor...

After the fundamental changes of the early 1990s and before Estonia joined the EU, many neo-liberal economists regarded Estonia as their model student - due to the country's economic principles. Economic growth has been positive from 1995 on (except in 1999) until 2007, and above the EU average....

The forces of the market and systems competition bring about economic and social convergence in Europe. There is no need for social policies at the EU level. Social harmonisation would distort migration flows and slow down the speed of economic convergence. National welfare states will be...