Workers Across Borders: Equity-Efficiency Trade-Offs for Mobility Policies

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This paper studies the effects of public policies that aim to enhance workers’ mobility across countries with different fiscal and social security regimes. Exploiting the unique setting provided by the largest European mobility scheme, which exempts mobile workers from fiscal and social security rules and contributions in their destination country, it studies the impacts of a coordinated mobility policy on workers, firms and fiscal outcomes in different countries and different sectors. The analysis highlights trade-offs faced by policy-makers in the design and implementation of mobility policies, and in incentives to coordinate or defect in these policies.