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The Labour Market Impact of Immigration: Quasi-Experimental Evidence

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  • Albrecht Glitz

    ()
    (Centre for Research and Analysis of Migration, Department of Economics, University College London)

Abstract

With the fall of the Berlin Wall, ethnic Germans living in the former Soviet Union and the Warsaw Pact countries were given the chance to migrate to Germany. Within 15 years, 2.8 million individuals moved. Upon arrival, these immigrants were exogenously allocated to different regions by the administration in order to ensure an even distribution across the country. Their inflows can therefore be seen as a natural experiment of immigration, avoiding the typical endogeneity problem of immigrant inflows with regard to local labour market conditions. I analyse the effect of these exogenous inflows on relative skill-specific employment and wage rates of the resident population in different geographical areas between 1996 and 2001. The variation I exploit in the empirical estimations arises primarily from differences in the initial skill composition across regions. Skill groups are defined either based on occupations or educational attainment. For both skill definitions, my results indicate a displacement effect of around 4 unemployed resident workers for every 10 immigrants that find a job. I do not find evidence of any detrimental effect on relative wages.

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Bibliographic Info

Paper provided by Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London in its series CReAM Discussion Paper Series with number 0612.

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Date of creation: Nov 2006
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Handle: RePEc:crm:wpaper:0612

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Keywords: Immigration; Labour Market Impact; Skill Groups; Germany;

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  1. David Card, 1989. "The Impact of the Mariel Boatlift on the Miami Labor Market," Working Papers 633, Princeton University, Department of Economics, Industrial Relations Section..
  2. Martin Nordin & Dan-Olof Rooth, 2007. "The Income Gap Between Natives and Second Generation Immigrants in Sweden: Is Skill the Explanation?," CReAM Discussion Paper Series 0706, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  3. Edin, Per-Anders & Fredriksson, Peter & Åslund, Olof, 2000. "Ethnic enclaves and the economic success of immigrants - evidence from a natural experiment," Working Paper Series 2000:9, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  4. Anna Piil Damm, 2009. "Ethnic Enclaves and Immigrant Labor Market Outcomes: Quasi-Experimental Evidence," Journal of Labor Economics, University of Chicago Press, vol. 27(2), pages 281-314, 04.
  5. Christian Dustmann & Francesca Fabbri & Ian Preston, 2005. "The Impact of Immigration on the UK Labour Market," CReAM Discussion Paper Series 0501, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
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  13. Eric Gould & Victor Lavy & Daniele M. Paserman, 2004. "Immigrating to Opportunity: Estimating The Effect of School Quality Using a Natural Experiment On Ethiopians in Israel," The Quarterly Journal of Economics, MIT Press, vol. 119(2), pages 489-526, May.
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Cited by:
  1. Christian Dustmann & Albrecht Glitz & Tommaso Frattini, 2008. "The Labour Market Impact of Immigration," CReAM Discussion Paper Series 0811, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  2. Florence Kondylis, 2007. "Conflict-Induced Displacement and Labour Market Outcomes: Evidence from Post-War Bosnia and Herzegovina," CEP Discussion Papers dp0777, Centre for Economic Performance, LSE.
  3. Christian Dustmann & Johannes Ludsteck & Uta Schönberg, 2009. "Revisiting the German Wage Structure," The Quarterly Journal of Economics, MIT Press, vol. 124(2), pages 843-881, May.
  4. Uwe Blien & Linda Borrs & Jens Südekum & Katja Wolf, 2014. "Local Labour Markets and Cultural Diversity," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 12(2), pages 27-34, 07.
  5. 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.
  6. repec:ese:iserwp:2008-17 is not listed on IDEAS
  7. Kondylis, Florence, 2010. "Conflict displacement and labor market outcomes in post-war Bosnia and Herzegovina," Journal of Development Economics, Elsevier, vol. 93(2), pages 235-248, November.

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