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Isolating the Network Effect of Immigrants on Trade

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Author Info

  • Aleksynska, Mariya

    ()
    (ILO International Labour Organization)

  • Peri, Giovanni

    ()
    (University of California, Davis)

Abstract

Within the migration-trade nexus literature, this paper proposes a more carefully defined measure of migration business networks, and quantifies its impact on bilateral trade. Using cross-sectional data and controlling for the overall bilateral stock of migrants, the share of migrants employed in managerial/business-related occupations has a strong additional effect on trade, and especially on exports. Those immigrants should be the ones directly involved in the diffusion and transmission of information relevant for companies trading with other countries. Their presence is found to increase the volume of trade beyond the already known effect of immigrants or highly educated immigrants. When we control for the presence of highly educated immigrants, the share of immigrants in business network occupations shows a particularly large effect on trade in differentiated goods. Specifically, we find that highly educated individuals in business-related occupations are those contributing to export by the largest margin. Business network effects seem particularly important in stimulating exports to culturally different countries, such as those with different legal origin.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6941.

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Length: 31 pages
Date of creation: Oct 2012
Date of revision:
Handle: RePEc:iza:izadps:dp6941

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Keywords: migration; international trade; business networks; differentiated goods;

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References

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Citations

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Cited by:
  1. Ernest Miguélez, 2014. "Inventor Diasporas and the Internalionalization of Technology," CReAM Discussion Paper Series 1425, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  2. Michael Good, 2013. "Geographic Proximity and the Pro-trade Effect of Migration: State-level Evidence from Mexican Migrants in the United States," 2013 Papers pgo530, Job Market Papers.
  3. Marina Murat, 2013. "Education ties and investments abroad. Empirical evidence from the US and UK," Center for Economic Research (RECent) 091, University of Modena and Reggio E., Dept. of Economics.
  4. Murat, Marina, 2014. "Out of Sight, Not Out of Mind. Education Networks and International Trade," World Development, Elsevier, vol. 58(C), pages 53-66.
  5. repec:mod:depeco:0002 is not listed on IDEAS
  6. Behncke, Nadine, 2014. "The structure of ethnic networks and exports: Evidence from Germany," Center for European, Governance and Economic Development Research Discussion Papers 198, University of Goettingen, Department of Economics.
  7. Mauro Lanati, 2014. "The sectoral pro-trade effects of ethnic networks within a Ricardian model of trade," Discussion Papers 2014/179, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
  8. repec:mod:depeco:0014 is not listed on IDEAS
  9. Felbermayr, Gabriel & Grossmann, Volker & Kohler, Wilhelm, 2012. "Migration, International Trade and Capital Formation: Cause or Effect?," IZA Discussion Papers 6975, Institute for the Study of Labor (IZA).
  10. Rodolfo Metulini & Paolo Sgrignoli & Stefano Schiavo & Massimo Riccaboni, 2014. "The migration network effect on international trade," Working Papers 5/2014, IMT Institute for Advanced Studies Lucca, revised May 2014.
  11. Michael Good, 2012. "How Localized is the Pro-trade Effect of Immigration? Evidence from Mexico and the United States," Working Papers 1203, Florida International University, Department of Economics.
  12. Hélène Ehrhart & Maëlan Le Goff & Emmanuel Rocher & Raju Jan Singh, 2012. "Does Migration Foster Exports? An African Perspective," Working Papers 2012-38, CEPII research center.

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