DOES EMPLOYMENT PROTECTION INFLUENCE MIGRATION FLOWS TOWARD OECD COUNTRIES?

We show that labour market institutions, and particularly employment protection are an important determinant of migration flows. Contrary to the popular wisdom, migrants are not attracted by more protective legislation. On the contrary, we show that the employment protection differential acts as a negative impact on migration flows. This differential in the case of high value can be seen as a lower integration on labour market and affects migration negatively. These results are obtained taking into consideration the high proportion of nil flows using Heckman two-steps method and Poisson method. We also control for a potential endogeneity bias by instrumenting our variable of employment protection.