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How Do Very Open Economies Absorb Large Immigration Flows? Recent Evidence from Spanish Regions

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Author Info
Gonzalez, Libertad () (Universitat Pompeu Fabra)
Ortega, Francesc () (Universitat Pompeu Fabra)

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Abstract

In recent years, Spain has received unprecedented immigration flows. Between 2001 and 2006 the fraction of the population born abroad more than doubled, increasing from 4.8% to 10.8%. For Spanish provinces with above-median inflows (relative to population), immigration increased the high school dropout population by 24%, while only increasing the number of college graduates by 11%. We study the different channels by which regional labor markets have absorbed the large increase in the relative supply of low educated (foreign-born) workers. We identify the exogenous supply shock using historical immigrant settlement patterns by country of origin. Using data from the Labor Force Survey and the decennial Census, we find a large expansion of employment in high immigration regions. Specifically, most industries in high-immigration regions experienced a large increase in the share of low-education employment. We do not find an effect on regions’ sectoral specialization. Overall, and perhaps surprisingly, Spanish regions have absorbed immigration flows in the same fashion as US local economies.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 3311.

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Length: 38 pages
Date of creation: Jan 2008
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Handle: RePEc:iza:izadps:dp3311

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Related research
Keywords: immigration; open economies; Rybcszynski; instrumental variables;

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Find related papers by JEL classification:
J2 - Labor and Demographic Economics - - Demand and Supply of Labor
F1 - International Economics - - Trade
O3 - Economic Development, Technological Change, and Growth - - Technological Change

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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 Card & John DiNardo, 2000. "Do Immigrant Inflows Lead to Native Outflows?," American Economic Review, American Economic Association, vol. 90(2), pages 360-367, May. [Downloadable!] (restricted)
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  2. Juan J. Dolado & Florentino Felgueroso & Juan F. Jimeno, . "The effects of minimum bargained wages on earnings: Evidence from Spain," Working Papers 97-04, FEDEA.
    Other versions:
  3. Gandal, Neil & Hanson, Gordon H. & Slaughter, M.J.Matthew J., 2004. "Technology, trade, and adjustment to immigration in Israel," European Economic Review, Elsevier, vol. 48(2), pages 403-428, April. [Downloadable!] (restricted)
    Other versions:
  4. Facchini, Giovanni & Mayda, Anna Maria, 2006. "Individual Attitudes Towards Immigrants: Welfare-State Determinants Across Countries," CEPR Discussion Papers 5702, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  5. Albert Saiz, 2003. "Room in the Kitchen for the Melting Pot: Immigration and Rental Prices," The Review of Economics and Statistics, MIT Press, vol. 85(3), pages 502-521, 05. [Downloadable!] (restricted)
  6. 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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  7. Ethan Lewis, 2005. "Immigration, skill mix, and the choice of technique," Working Papers 05-8, Federal Reserve Bank of Philadelphia. [Downloadable!]
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  13. 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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  14. Saiz, Albert, 2007. "Immigration and housing rents in American cities," Journal of Urban Economics, Elsevier, vol. 61(2), pages 345-371, March. [Downloadable!] (restricted)
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  15. Raquel Carrasco & Juan Jimeno & A. Ortega, 2008. "The effect of immigration on the labor market performance of native-born workers: some evidence for Spain," Journal of Population Economics, Springer, vol. 21(3), pages 627-648, July. [Downloadable!] (restricted)
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  18. 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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  19. Ethier, Wilfred, 1972. "Nontraded Goods and the Heckscher-Ohlin Model," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 13(1), pages 132-47, February. [Downloadable!] (restricted)
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  22. Raquel Carrasco & Juan F. Jimeno & Ana Carolina Ortega, 2004. "The Effect Of Immigration On The Employment Opportunities Of Native-Born Workers: Some Evidence For Spain," Economics Working Papers we046122, Universidad Carlos III, Departamento de Economía. [Downloadable!]
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  23. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December. [Downloadable!] (restricted)
  24. Carrington, William J & Detragiache, Enrica & Vishwanath, Tara, 1996. "Migration with Endogenous Moving Costs," American Economic Review, American Economic Association, vol. 86(4), pages 909-30, September. [Downloadable!] (restricted)
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  26. Ethan Lewis, 2003. "Local, open economies within the U.S.: how do industries respond to immigration?," Working Papers 04-1, Federal Reserve Bank of Philadelphia. [Downloadable!]
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. Catalina Amuedo-Dorantes & Sara de la Rica, 2007. "Immigrants’ Responsiveness to Labor Market Conditions and their Impact on Regional Employment Disparities: Evidence from Spain," Working Papers 2007-34, FEDEA. [Downloadable!]
    Other versions:
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