Abstract for: Influence Of Labor Migration On Latvia's Labor Market

This paper shows system dynamic model of labor market and labor migration in Latvia. The hypothesis of the research is that: labor migration is determined primarily by the payment level in the countries under consideration and indicator derived from it – payment difference in compared countries; also employment level, unemployment level, number of work places (market capacity) and number of vacant work places. Secondary factors influencing migration may be costs connected with labor migration, formal legal barriers of migration and personal propensity to migrate. Statistics on the Latvia’s labor market are not complete; there is also no common view of experts about determinant processes. In such circumstances forecasting of market with quantitative methods is problematic. One approach is to simulate indicators and to estimate their influence on national economy. The model has three parts: labor force expansion, allocation and migration sub models. Labor force expansion sub model is based on allocation of population in various categories during transition to a working age population. Allocation by level of educational is further used in labor markets analysis, where, according to the education level, worker groups are formed. Mutual interaction of groups of workers together with labor migration is represented in paper. In results is shown model factors sensitivity from personal propensity to labor migration.