Studying abroad and the effect on international labor market mobility: evidence from the introduction of Erasmus

We investigate the e¤ect of studying abroad on international labor market mobility later in life for German university graduates. As a source of identifying variation, we exploit the introduction and expansion of the ERASMUS student exchange program, which significantly increases a student's probability of studying abroad. Using an Instrument Variable approach we control for unobserved heterogeneity between individuals who studied abroad and those who did not. Our results indicate that student exchange mobility is an important determinant of later international labor market mobility: We find that studying abroad increases an individual's probability of working in a foreign country by about 15 to 20 percentage points, suggesting that study abroad spells are an mportant channel to later outmigration. The results are robust to a number of specification checks.