Baltic International Centre for Economic Policy Studies (BICEPS) is a partner in the Nordic-Baltic integration project LIFT
BICEPS is participating in the Baltic Research Program project “Economic Integration of the Nordic-Baltic Region through Labour, Innovation, Investments and Trade” (LIFT) funded by the European Economic Area (EEA) countries (Iceland and Lichtenstein) and Norway grants for the period 2014–2021.
The aim of the project is to identify in a unified framework how transnational regional integration has contributed to economic development and growth in the Nordic-Baltic Region. What are the associated challenges and lessons to learn for future policy design? The acronym LIFT reflects our main hypotheses: the integration in the Nordic-Baltic Region has lifted the local economies and contributed to a more efficient resource allocation. The LIFT project consists of four closely linked work packages (WP) with the 1st letters of their titles forming the acronym, each of the WP’s focusing on a particular aspect of integration.
- Labour market developments in the context of digitalisation and social change
- Innovation and technology transfers
- Foreign direct investments and capital mobility
- Trade of commodities and services
BICEPS will mainly contribute to work package 1 and 3. Both working packages will require the use of very large administrative datasets combined with advanced quantitative methods. BICEPS researchers will bring their expertise and experience implementing large scale econometrics projects.
WP1 focuses on the recent and rapid labour market developments (including consequences of the COVID-19 pandemic), which create new challenges for employees and employers, generate new forms of labour, changes in working conditions and in the structure of the labour force. This in turn calls for development of legal regulations and human capital, adjustment with cultural challenges as well as enlarge possibilities for the integration of people from different countries and with different ethnicities. This includes studying job flows and worker flows between sectors and between firms and identifying the main characteristics (including personal traits, cognitive and non-cognitive skills) of people switching to the new labor forms, as well as firms experiencing substantial inflows or outflows of workers after the pandemic. In particular, what kind of workers and in which sectors were switching to work from home? Was there a reversal after the pandemic?
WP3 is motivated by how Nordic FDI and public grants in the Baltics contribute to integration of the Nordic-Baltic Region over the last three decades. Norwegian FDI in the Baltics reached 2.5 billion euro in 2016. Nordic FDIs and grants may induce positive impulses and distributional impacts on the Baltic economy, enhancing productivity, labor market performance, social welfare and public service provision. Performance of Nordic-Baltic firms will be benchmarked with that of domestic firms and firms of other international consolidations with investors in countries of similar development. We investigate how Norwegian ownership in Baltic firms affects the performance of Baltic subsidiaries and Nordic mother companies and thereby aggregate income. Further, we will study the impact of FDI on wage gaps and labor composition (occupations and education) and mobility of employees between/within consolidations. The aim is to investigate how human resource policy (e.g. cultural traits of investors) are affected by firm being purchased by a foreign entity.
The project period runs from 2021 until the end of 2023.
The research consortium is led by Vilnius Gedimina's Technical University of Lithuania. Other research partners are the University of Tartu in Estonia, the University of Latvia, and Institute of Transport Economics in Norway. In addition, the project has five stakeholder partners - Export Credit, the Nordic Council, and the Norwegian Chamber of Commerce in Latvia, the Norwegian-Lithuanian Chamber of Commerce, and the Norwegian-Estonian Chamber of Commerce.
Marija Krumiņa is BICEPS project manager for the LIFT project. Nicolas Gavoille is BICEPS senior researcher and a contact person for the LIFT project, and Janis Upenieks is a junior researcher associated with the LIFT project.
See https://sisu.ut.ee/lift/project-consortium for more details about the LIFT project.
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Project contract with the Research Council of Lithuania is S-BMT-21-7 (LT08-2-LMT-K-01-070).