This article surveys the main effects of labor migration between two countries. Against the background of high immigration to industrialized countries in recent years, notably to countries in Europe, the focus of the discussion is on the host country of the migrants. In the standard model of labor migration, there are overall benefits when wage differentials trigger labor migration. However, in the presence of externalities and deviations from the basic assumptions, the results can be significantly different.
This article reviews several hypotheses that aim at explaining the development of German merchandise exports. Based on cointegration estimation techniques, we examine different determinants for their ability to explain German exports during the period 1992–2016. The estimation results indicate that, in addition to the traditional determinants (world demand and price competitiveness), other determinants, such as energy prices and the increasing fragmentation of production processes, are also crucial in explaining German exports.