IDEAS home Printed from https://ideas.repec.org/p/mit/worpap/94-08.html
   My bibliography  Save this paper

Wages and Employment Effects of Immigration to Germany: An Analysis Based on Local Labor Markets

Author

Listed:
  • Pischke, J.S.
  • Velling, J.

Abstract

We analyse the impact of increased immigration on labour market outcomes of natives in Germany using a dataset of county-level variables for the late 1980s. We study two measures of immigration, the change in the share of foreigners between 1985 and 1989, and one-year gross and net flows of immigrants to an area. In order to address the potential problem of immigrant bias towards local labour markets with above average performance we instrument the change in the foreign share by its previous level. Especially for unemployment we find large effects of an increased foreign share. We conjecture that these results might be spurious. Foreigners tend to be concentrated in lower unemployment areas but unemployment tends to be mean reverting during the boom period we study. This leads to a positive correlation between the instrument and the change in unemployment. Taking account of the mean reversion in unemployment we find no detrimental effect of immigration. Similar results are obtained on the basis of one-year flow data of foreigners. We also find no support for the hypothesis that the absence of displacement effects are due to a response of native migration patterns. The initial settlement of immigrants in Germany is largely independent of labour market conditions. Subsequent internal moves by foreigners are more responsive to local unemployment albeit much less than internal migration of natives.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Pischke, J.S. & Velling, J., 1994. "Wages and Employment Effects of Immigration to Germany: An Analysis Based on Local Labor Markets," Working papers 94-08, Massachusetts Institute of Technology (MIT), Department of Economics.
    • Handle: RePEc:mit:worpap:94-08
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    References listed on IDEAS

    as
    1. David Card, 1990. "The Impact of the Mariel Boatlift on the Miami Labor Market," ILR Review, Cornell University, ILR School, vol. 43(2), pages 245-257, January.
    2. Borjas, George J. & Freeman, Richard B. (ed.), 1992. "Immigration and the Work Force," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226066332, December.
    3. Joseph G. Altonji & David Card, 1991. "The Effects of Immigration on the Labor Market Outcomes of Less-skilled Natives," NBER Chapters, in: Immigration, Trade, and the Labor Market, pages 201-234, National Bureau of Economic Research, Inc.
    4. George J. Borjas & Richard B. Freeman & Lawrence F. Katz, 1992. "On the Labor Market Effects of Immigration and Trade," NBER Chapters, in: Immigration and the Work Force: Economic Consequences for the United States and Source Areas, pages 213-244, National Bureau of Economic Research, Inc.
    5. Abowd, John M. & Freeman, Richard B. (ed.), 1991. "Immigration, Trade, and the Labor Market," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226000954, December.
    6. Butcher, Kristin F & Card, David, 1991. "Immigration and Wages: Evidence from the 1980's," American Economic Review, American Economic Association, vol. 81(2), pages 292-296, May.
    7. Kristin Butcher & David Card, 1991. "Immigration and Wages: Evidence From the 1980's," Working Papers 661, Princeton University, Department of Economics, Industrial Relations Section..
    8. Kevin Lang & William T. Dickens, 1993. "Bilateral Search as an Explanation for Labor Market Segmentation and Other Anomalies," NBER Working Papers 4461, National Bureau of Economic Research, Inc.
    9. George J. Borjas & Richard B. Freeman, 1992. "Immigration and the Work Force: Economic Consequences for the United States and Source Areas," NBER Books, National Bureau of Economic Research, Inc, number borj92-1, May.
    10. John M. Abowd & Richard B. Freeman, 1991. "Immigration, Trade, and the Labor Market," NBER Books, National Bureau of Economic Research, Inc, number abow91-1, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rachel M. Friedberg & Jennifer Hunt, 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.
    2. Kit‐Chun Lam & Pak‐Wai Liu, 1998. "Immigration, Population Heterogeneity, And Earnings Inequality In Hong Kong," Contemporary Economic Policy, Western Economic Association International, vol. 16(3), pages 265-276, July.
    3. Thomas Bauer, 1998. "Do Immigrants Reduce Natives' Wages? Evidence from Germany," Departmental Working Papers 199802, Rutgers University, Department of Economics.
    4. Baez, Javier E., 2011. "Civil wars beyond their borders: The human capital and health consequences of hosting refugees," Journal of Development Economics, Elsevier, vol. 96(2), pages 391-408, November.
    5. Sari Pekkala Kerr & William R. Kerr, 2011. "Economic Impacts of Immigration: A Survey," Finnish Economic Papers, Finnish Economic Association, vol. 24(1), pages 1-32, Spring.
    6. Antje Mertens & Anette Haas, 2006. "Regionale Arbeitslosigkeit und Arbeitsplatzwechsel in Deutschland – Eine Analyse auf Kreisebene," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 26(2), pages 147-169, October.
    7. Antje Mertens & Anette Haas, 2005. "Regional Unemployment and Job Switches in Germany – An Analysis at District Level," ERSA conference papers ersa05p592, European Regional Science Association.
    8. Kalckreuth, Ulf von, 2000. "Ethnic Dualism and Communication Costs – Explaining Segmentation and Wage Inertia," Discussion Papers 593, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
    9. Velling, Johannes, 1995. "Die Arbeitserlaubnis als Instrument der Arbeitsmarktpolitik zur Steuerung internationaler Zuwanderung auf den Arbeitsmarkt," ZEW Discussion Papers 95-16, ZEW - Leibniz Centre for European Economic Research.
    10. Zweimuller, Josef & Winter-Ebmer, Rudolf, 1995. "Internal labor markets and firm-specific determination of earnings in the presence of immigrant workers," Economics Letters, Elsevier, vol. 48(2), pages 185-191, May.
    11. Leire Aldaz Odriozola & Begoña Eguía Peña, 2016. "Immigration and Occupational Mobility of Native Workers in Spain. A Gender Perspective," Journal of International Migration and Integration, Springer, vol. 17(4), pages 1181-1193, November.
    12. Steinhardt, Max Friedrich, 2006. "Arbeitsmarkt und Migration: Eine empirische Analyse der Lohn- und Beschäftigungseffekte der Zuwanderung für Deutschland," HWWI Research Papers 3-4, Hamburg Institute of International Economics (HWWI).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. George J. Borjas, 1995. "The internationalization of the U.S. labor market and the wage structure," Economic Policy Review, Federal Reserve Bank of New York, issue Jan, pages 3-8.
    2. Dustmann, Christian & Glitz, Albrecht, 2011. "Migration and Education," Handbook of the Economics of Education, in: Erik Hanushek & Stephen Machin & Ludger Woessmann (ed.), Handbook of the Economics of Education, edition 1, volume 4, chapter 0, pages 327-439, Elsevier.
    3. Ottaviano, Gianmarco & Peri, Giovanni, 2005. "Rethinking the Gains from Immigration: Theory and Evidence from the US," CEPR Discussion Papers 5226, C.E.P.R. Discussion Papers.
    4. Kifle, Temesgen, 2009. "The effect of immigration on the earnings of native-born workers: Evidence from Australia," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(2), pages 350-356, March.
    5. Saiz, Albert, 2007. "Immigration and housing rents in American cities," Journal of Urban Economics, Elsevier, vol. 61(2), pages 345-371, March.
    6. Jiong Tu, 2007. "The Impact of Immigration on the Labour Market Outcomes of Native-born Canadians," Social and Economic Dimensions of an Aging Population Research Papers 216, McMaster University.
    7. Gianmarco I.P. Ottaviano & Giovanni Peri, 2005. "Rethinking the Gains from Immigration: Theory and Evidence from the U.S," NBER Working Papers 11672, National Bureau of Economic Research, Inc.
    8. 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.
    9. Rachel M. Friedberg & Jennifer Hunt, 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.
    10. Greenwood, Michael J. & Hunt, Gary L. & Kohli, Ulrich, 1997. "The factor-market consequences of unskilled immigration to the United States," Labour Economics, Elsevier, vol. 4(1), pages 1-28, March.
    11. Maude Toussaint-Comeau, 2007. "The impact of Mexican immigrants on U.S. wage structure," Working Paper Series WP-07-24, Federal Reserve Bank of Chicago.
    12. Pekkala, Sari, 2005. "Economic Impacts of Immigration: A Survey," Discussion Papers 362, VATT Institute for Economic Research.
    13. Roberto Pedace, 2006. "Immigration, Labor Market Mobility, and the Earnings of Native‐Born Workers," American Journal of Economics and Sociology, Wiley Blackwell, vol. 65(2), pages 313-345, April.
    14. Sari Pekkala Kerr & William R. Kerr, 2011. "Economic Impacts of Immigration: A Survey," Finnish Economic Papers, Finnish Economic Association, vol. 24(1), pages 1-32, Spring.
    15. Abdurrahman Aydemir & George J. Borjas, 2011. "Attenuation Bias in Measuring the Wage Impact of Immigration," Journal of Labor Economics, University of Chicago Press, vol. 29(1), pages 69-113, January.
    16. Aydemir, Abdurrahman B. & Kırdar, Murat G., 2017. "Quasi-experimental impact estimates of immigrant labor supply shocks: The role of treatment and comparison group matching and relative skill composition," European Economic Review, Elsevier, vol. 98(C), pages 282-315.
    17. Steinhardt Max Friedrich, 2011. "The Wage Impact of Immigration in Germany - New Evidence for Skill Groups and Occupations," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-35, June.
    18. Simonetta Longhi & Peter Nijkamp & Jacques Poot, 2009. "Regional Economic Impacts of Immigration: A Review," Tinbergen Institute Discussion Papers 09-047/3, Tinbergen Institute, revised 23 Jul 2009.
    19. George J. Borjas & Richard B. Freeman & Lawrence F. Katz, 1992. "On the Labor Market Effects of Immigration and Trade," NBER Chapters, in: Immigration and the Work Force: Economic Consequences for the United States and Source Areas, pages 213-244, National Bureau of Economic Research, Inc.
    20. Furtado, Delia & Hock, Heinrich, 2008. "Immigrant Labor, Child-Care Services, and the Work-Fertility Trade-Off in the United States," IZA Discussion Papers 3506, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    immigration ; labour market ; unemployment;
    All these keywords.

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mit:worpap:94-08. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Linda Woodbury (email available below). General contact details of provider: https://edirc.repec.org/data/edmitus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.