This paper argues that labour mobility shapes shock propagation in currency unions through its interaction with regional fiscal space. In a New Keynesian open-economy model of migration with debt limits, I show analytically that mobility has two opposing effects on fiscal space: emigration expands fiscal capacity through spillovers that raise per-capita fiscal contributions, but contracts it through increased per-capita debt burden. The dominant effect determines whether mobility enables a stronger expansionary fiscal response to negative idiosyncratic shocks, reinforcing its stabilising role; or forces pro-cyclical consolidations that amplify the original shock. Using LinkedIn data, I construct a novel panel of monthly intra-EU migration flows for 2000–2019. SVAR and local projection estimates show that a one-standard-deviation emigration shock contracts government consumption during high-debt regimes by a cumulative 2.3 percentage points of trend GDP over 20 quarters relative to low-debt regimes, consistent with the amplification mechanism dominating where the debt burden channel is strongest.

This paper empirically tests whether minimum wages may have positive employment effects when diverging from a perfect competition framework. I use administrative data from 1986 to 2013 to segment Portugal into several local labour markets and construct Herfindahl–Hirschman Indices to measure concentration levels in each market. I find that increased minimum wage exposure has differential employment effects depending on labour market concentration — estimates indicate employment responds negatively in highly competitive markets and positively in highly concentrated ones. These results are robust to the usage of instrumental variables and to different definitions of local labour markets, although the persistence of these effects varies across specifications. Labour markets are highly heterogeneous in their concentration level, which can help reconcile the conflicting results in the minimum wage literature and provide new policy insights.

• July 202316th Annual Meeting of the Portuguese Economic Journal, Braga