Academic journal article E+M Ekonomie a Management

The Effects of European Economic Integration and the Impact of Brexit on the UK Immigrants from the CEE Countries

Academic journal article E+M Ekonomie a Management

The Effects of European Economic Integration and the Impact of Brexit on the UK Immigrants from the CEE Countries

Article excerpt

Introduction

Even if most immigrants come from non-EU states, the EU membership is often considered as the UK's perceived migration issue. Immigration is an actual problem in the UK and one of the main causes of Brexit. The debate regarding the immigrants issue is mostly referred to less developed countries from Central and Eastern Europe which joined the EU the latest. Some Britons considered that immigrants exerted high pressure on public services. Contrary to this opinion, Petroff (2016) showed that immigrants contribute to the country's budget and stimulate economic growth. Most immigrants come to work and therefore, they pay taxes. Moreover, they often compensate for the ageing local population. According to the Brexit scenario, migration will be limited, which from the economic point of view implies lower economic growth and higher burden of the exchequer.

According to the principle of free movement of persons, goods, services and capital, non-British EU citizens have the right to work in the UK (Boswell, 2016). As Staiger (2016) explained, the UK can completely control its borders and it is exempt from common standards in immigration and some asylum regulations. The number of the UK immigrants from the CEE countries increased after their entrance into the EU, but actually most of these emigrants preferred such countries as Germany, Spain, Italy and France (Cajka et al., 2014; Tilford, 2015).

Rumpel et al. (2013) showed that migrants from CEE countries prefer cities or urban regions because of the employment opportunities. Moreover, microeconomic determinants of migration were identified by Merkevicius et al. (2015) who consider that deficiencies in human resources management in the developing countries determined migration in developed countries.

The main aim of this paper is to evaluate the question of migration in the context of economic development in the UK, to show the positive impact of the UK immigrants from the CEE countries on the UK economy after their economic integration, and the possible negative consequences of Brexit on the migration process from some CEE countries to the UK. We will focus only on the increase of the number of UK immigrants from these countries due to the EU membership, making comparisons with other CEE countries that did not entered the EU. The sample of the CEE countries was selected to include the available data on ethnic communities with a consistent number of immigrants. Due to the nature of data and the existence of some mixed effects in explaining the emigrants' behaviour, some specific Poisson models were estimated. Moreover, a counterfactual analysis by comparing the EU countries with the group represented by Russia, and Ukraine was conducted. The influence of Brexit itself might reduce the number of immigrants from the CEE countries twofold, and potential future migration policies may reduce it further. The CEE emigrants might come back home or they can go to other EU countries (countries with a large number of CEE immigrants or on the opposite, to the countries with less immigrants).

Moreover, we empirically check the assumptions regarding the impact of CEE countries' emigrants on the main macroeconomic indicators in the UK, proving that the results are consistent with the previous studies on the immigrants overall. Emigrants from the CEE countries had a positive impact on the UK economy and their arrival in the UK should be stimulated after Brexit.

The paper is organized as follows. After the Introduction, a literature review is presented. The methodological framework is set up and the empirical results are interpreted. Conclusion is the final part of the paper.

The paper is organized as follows. After the Introduction, a literature review is presented. The methodological framework is set up and the empirical results are interpreted. Conclusion is the final part of the paper.

1. Literature Review

This research focuses on the impact of economic integration and Brexit on the UK immigrants from less developed countries, namely, from the CEE. …

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