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Immigration And Native Welfare

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  • Gabriel J. Felbermayr
  • Wilhelm Kohler

Abstract

This article unifies two approaches for identifying the welfare and wage effects of immigration, one emphasizing the immigration surplus, the other stressing a potential welfare loss due to a terms-of-trade effect. We decompose the native welfare effect into a standard complementarity effect, augmented by a Stolper-Samuelson effect, and a terms-of-trade effect. We illustrate the welfare and wage effects of endogenous goods prices in a stylized-specific factors model. Finally, we calibrate this model to a generic OECD economy and provide simulation results. The key insight is that endogenous goods prices play a quantitatively important role, sometimes even overturning received results. Copyright 2007 by the Economics Department Of The University Of Pennsylvania And Osaka University Institute Of Social And Economic Research Association.

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Bibliographic Info

Article provided by Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association in its journal International Economic Review.

Volume (Year): 48 (2007)
Issue (Month): 3 (08)
Pages: 731-760

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Handle: RePEc:ier:iecrev:v:48:y:2007:i:3:p:731-760

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Citations

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Cited by:
  1. Bowen, Harry P. & Pédussel Wu, Jennifer, 2012. "Immigrant specificity and the relationship between trade and immigration: Theory and evidence," Working Papers 70, Institute of Management Berlin (IMB), Berlin School of Economics and Law.
  2. Muysken, Joan & Vallizadeh, Ehsan & Ziesemer, Thomas, 2012. "Migration, Unemployment, and Over-qualification: A Specific-Factors Model Approach," MPRA Paper 43057, University Library of Munich, Germany.
  3. Gabriel J. Felbermayr & Wido Geis & Wilhelm Kohler, 2008. "Restrictive Immigration Policy in Germany: Pains and Gains Foregone?," CESifo Working Paper Series 2316, CESifo Group Munich.
  4. Picard, Pierre M. & Worrall, Tim, 2014. "Is a Policy of Free Movement of Workers Sustainable?," IZA Discussion Papers 8035, Institute for the Study of Labor (IZA).
  5. Muysken, Joan & Vallizadeh, Ehsan & Ziesemer, Thomas, 2012. "The impact of Medium-Skilled immigration: A general equilibrium approach," MERIT Working Papers 055, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
  6. Wilhelm Kohler & Gabriel Felbermayr, . "Can International Migration Ever Be Made a Pareto Improvement?," Discussion Papers 09/01, University of Nottingham, GEP.
  7. Harry P. Bowen & Jennifer Wu, 2013. "The Impact of Immigrant Gender on International Trade: An Empirical Assessment," Discussion Paper Series 2013-01, McColl School of Business, Queens University of Charlotte.
  8. Junko Doi & Laixun Zhao, 2012. "Immigration Conflicts," Discussion Paper Series DP2012-29, Research Institute for Economics & Business Administration, Kobe University, revised Dec 2012.
  9. Karin Mayr, 2008. "Optimal quota for sector-specific immigration," The Institute for International Integration Studies Discussion Paper Series iiisdp254, IIIS.
  10. Udo Kreickemeier & Michael S. Michael, . "Unemployment and the Immigration Surplus," Discussion Papers 08/31, University of Nottingham, GEP.
  11. Michele Battisti & Gabriel Felbermayr & Giovanni Peri & Panu Poutvaara, 2014. "Immigration, Search, and Redistribution: A Quantitative Assessment of Native Welfare," NBER Working Papers 20131, National Bureau of Economic Research, Inc.
  12. Wido Geis, 2009. "Does Educational Choice Erode the Immigration Surplus?," Ifo Working Paper Series Ifo Working Paper Nr. 80, Ifo Institute for Economic Research at the University of Munich.
  13. Biavaschi, Costanza & Elsner, Benjamin, 2013. "Let's Be Selective about Migrant Self-Selection," IZA Discussion Papers 7865, Institute for the Study of Labor (IZA).

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