The Effects of Immigration on Wages: An Application of the Structural Skill-Cell Approach
AbstractThis paper investigates how recent immigration inflows from 2002 to 2008 have affected wages in Switzerland. This period is of particular interest as it marks the time during which the bilateral agreement with the EU on the free crossborder movement of workers has been effective. Since different types of workers are likely to be unevenly affected by recent immigration inflows, we follow the "structural skill-cell approach" as for example employed by Borjas (2003) and Ottaviano and Peri (2008). This paper provides two main contributions. First, we estimate empirically the elasticities of substitution between different types of workers in Switzerland. Our results suggest that natives and immigrants are imperfect substitutes. Regarding different skill levels, the estimates indicate that workers are imperfect substitutes across broad education groups and across different experience groups. Second, the estimated elasticities of substitution are used to simulate the impact on domestic wages using the actual immigration inflows from 2002 to 2008. For the long run, the simulations produce some notable distributional consequences across different types of workers: While previous immigrants incur wage losses (-1.6%), native workers are not negatively affected on average (+0.4%). In the short run, immigration has a negative macroeconomic effect on the average wage, which, however, gradually dies out in the process of capital adjustment.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Swiss Society of Economics and Statistics (SSES) in its journal Swiss Journal of Economics and Statistics.
Volume (Year): 146 (2010)
Issue (Month): IV (December)
Contact details of provider:
Postal: c/o SNB/BNS, Börsenstrasse 15, PO Box 2800, CH-8022 Zürich
Phone: +41 (0)44 631 32 34
Fax: +41 (0)44 631 39 01
Web page: http://www.sjes.ch
More information through EDIRC
immigration; wages; labour demand; labour supply; skill groups; elasticity of substitution;
Other versions of this item:
- Michael Gerfin & Boris Kaiser, 2010. "The Effects of Immigration on Wages: An Application of the Structural Skill-Cell Approach," Diskussionsschriften dp1012, Universitaet Bern, Departement Volkswirtschaft.
- E24 - Macroeconomics and Monetary Economics - - Macroeconomics: Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
- J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
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.:
- Gianmarco I. P. Ottaviano & Francesco D’Amuri & Giovanni Peri, 2008.
"The Labor Market Impact of Immigration in Western Germany in the 1990’s,"
2008.16, Fondazione Eni Enrico Mattei.
- D'Amuri, Francesco & Ottaviano, Gianmarco I.P. & Peri, Giovanni, 2010. "The labor market impact of immigration in Western Germany in the 1990s," European Economic Review, Elsevier, vol. 54(4), pages 550-570, May.
- Francesco D'Amuri & Gianmarco I. P. Ottaviano & Giovanni Peri, 2009. "The Labor Market Impact of Immigration in Western Germany in the 1990's," CReAM Discussion Paper Series 0910, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
- Francesco D'Amuri & Gianmarco I. P. Ottaviano & Giovanni Peri, 2008. "The Labor Market Impact of Immigration in Western Germany in the 1990's," Temi di discussione (Economic working papers) 687, Bank of Italy, Economic Research and International Relations Area.
- D''Amuri, Francesco & Ottaviano, Gianmarco Ireo Paolo & Peri, Giovanni, 2008. "The Labour Market Impact of Immigration in Western Germany in the 1990's," CEPR Discussion Papers 6736, C.E.P.R. Discussion Papers.
- D'Amuri, Francesco & Ottaviano, Gianmarco I. P. & Peri, Giovanni, 2008. "The labor market impact of immigration in Western Germany in the 1990's," HWWI Research Papers 3-12, Hamburg Institute of International Economics (HWWI).
- Francesco D'Amuri & Gianmarco I.P. Ottaviano & Giovanni Peri, 2008. "The Labor Market Impact of Immigration in Western Germany in the 1990's," NBER Working Papers 13851, National Bureau of Economic Research, Inc.
- John P. Haisken-DeNew & Klaus F. Zimmermann, . "Native Wage Impacts of Foreign Labor," Working Papers 9408, SELAPO Center for Human Resources.
- Sandro Favre, 2011. "The impact of immigration on the wage distribution in Switzerland," ECON - Working Papers 022, Department of Economics - University of Zurich.
- Christoph Basten & Michael Siegenthaler, 2013. "Do immigrants take or create residents’ jobs? Quasi-experimental evidence from Switzerland," KOF Working papers 13-335, KOF Swiss Economic Institute, ETH Zurich.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Steiner).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.