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Priority clash

Asymmetrical Information: "Old Europe's" welfare states will undermine European integration (Martin Wolf in today's Financial Times):

Hourly labour costs in the present wave of accession countries were, on average, one-seventh of the west German level in 2003... The incentive for migration then is huge, as is that for moving production in the opposite direction...

However, such migration is economically useless: it reduces output in the country of origin and lowers it in the recipient. Only if countries have flexible labour markets can migration be beneficial. Israel, the US and today's UK come to mind. Germany is in the opposite category.

I particularly liked the phrase "nationals who are indifferent between work and state support".

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