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Immigration And Native Welfare

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Author Info
Gabriel J. Felbermayr
Wilhelm Kohler

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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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File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1468-2354.2007.00443.x
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Publisher 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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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. David K. Backus & Patrick J. Kehoe & Finn E. Kydland, 1993. "International Business Cycles: Theory and Evidence," Working Papers 93-21, New York University, Leonard N. Stern School of Business, Department of Economics.
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  2. Chiswick, Barry R. & Hatton, Timothy J., 2002. "International Migration and the Integration of Labor Markets," IZA Discussion Papers 559, Institute for the Study of Labor (IZA). [Downloadable!]
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  3. Guillermina Jasso & Mark Rosensweig & James P. Smith, 2003. "The Earnings of US immigrants," Labor and Demography 0312007, EconWPA. [Downloadable!]
  4. Neary, J Peter, 1985. "International Factor Mobility, Minimum Wage Rates, and Factor-Price Equalization: A Synthesis," The Quarterly Journal of Economics, MIT Press, vol. 100(3), pages 551-70, August. [Downloadable!] (restricted)
  5. Ethier, Wilfred J, 1985. "International Trade and Labor Migration," American Economic Review, American Economic Association, vol. 75(4), pages 691-707, September. [Downloadable!] (restricted)
  6. Mussa, Michael, 1974. "Tariffs and the Distribution of Income: The Importance of Factor Specificity, Substitutability, and Intensity in the Short and Long Run," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1191-1203, Nov.-Dec.. [Downloadable!] (restricted)
  7. Friedberg, Rachel M & Hunt, Jennifer, 1995. "The Impact of Immigrants on Host Country Wages, Employment and Growth," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 23-44, Spring. [Downloadable!] (restricted)
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  8. Donald R. Davis & David E. Weinstein, 2002. "Technological Superiority and the Losses from Migration," NBER Working Papers 8971, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  9. Assaf Razin & Efraim Sadka, 1997. "International Migration and International Trade," NBER Working Papers 4230, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  10. Borjas, George J, 1995. "The Economic Benefits from Immigration," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 3-22, Spring. [Downloadable!] (restricted)
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  11. Card, David, 2001. "Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 22-64, January. [Downloadable!] (restricted)
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  12. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December. [Downloadable!] (restricted)
  13. Kevin H. O'Rourke & Jeffrey G. Williamson, 2001. "Globalization and History: The Evolution of a Nineteenth-Century Atlantic Economy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650592.
  14. Borjas, George J., 1999. "The economic analysis of immigration," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 28, pages 1697-1760 Elsevier. [Downloadable!] (restricted)
  15. Sanoussi Bilal & Jean-Marie Grether & Jaime de Melo, 2003. "Attitudes Towards Immigration: a Trade-Theoretic Approach," Review of International Economics, Blackwell Publishing, vol. 11(2), pages 253-267, 05. [Downloadable!] (restricted)
  16. Engerman, Stanley L & Jones, Ronald W, 1997. "International Labor Flows and National Wages," American Economic Review, American Economic Association, vol. 87(2), pages 200-204, May. [Downloadable!] (restricted)
  17. Muller, Tobias, 2003. "Migration, unemployment and discrimination," European Economic Review, Elsevier, vol. 47(3), pages 409-427, June. [Downloadable!] (restricted)
  18. Srinivasan, T. N., 1983. "International factor movements, commodity trade and commercial policy in a specific factor model," Journal of International Economics, Elsevier, vol. 14(3-4), pages 289-312, May. [Downloadable!] (restricted)
  19. Ralph Chami & Samir Jahjah & Connel Fullenkamp, 2003. "Are Immigrant Remittance Flows a Source of Capital for Development," IMF Working Papers 03/189, International Monetary Fund. [Downloadable!]
  20. George J. Borjas, 2003. "The Labor Demand Curve is Downward Sloping: Reexamining the Impact of Immigration on the Labor Market," NBER Working Papers 9755, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  21. De New, John P & Zimmermann, Klaus F, 1994. "Native Wage Impacts of Foreign Labor: A Random Effects Panel Analysis," Journal of Population Economics, Springer, vol. 7(2), pages 177-92.
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Wilhelm Kohler & Gabriel Felbermayr, . "Can International Migration Ever Be Made a Pareto Improvement?," Discussion Papers 09/01, University of Nottingham, GEP. [Downloadable!]
  2. Karin Mayr, 2008. "Optimal quota for sector-specific immigration," The Institute for International Integration Studies Discussion Paper Series iiisdp254, IIIS. [Downloadable!]
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  3. Gabriel J. Felbermayr & Wido Geis & Wilhelm Kohler, 2008. "Restrictive Immigration Policy in Germany: Pains and Gains Foregone?," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
    Other versions:
  4. 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. [Downloadable!]
  5. Gabriel J Felbermayr & Wilhelm Kohler, 2009. "Can International Migration Ever Be Made a Pareto Improvement?," Diskussionspapiere aus dem Institut für Volkswirtschaftslehre der Universität Hohenheim 305/2009, Department of Economics, University of Hohenheim, Germany. [Downloadable!]
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