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Immigration, Jobs and Employment Protection: Evidence from Europe

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  • Francesco D'Amuri
  • Giovanni Peri

Abstract

In this paper we analyze the effect of immigrants on native jobs in fourteen Western European countries. We test whether the inflow of immigrants in the period 1996-2007 decreased employment rates and/or if it altered the occupational distribution of natives with similar education and age. We find no evidence of the first but significant evidence of the second: immigrants took "simple" (manual-routine) type of occupations and natives moved, in response, toward more "complex" (abstract-communication) jobs. The results are robust to the use of an IV strategy based on past settlement of different nationalities of immigrants across European countries. We also document the labor market flows through which such a positive reallocation took place: immigration stimulated job creation, and the complexity of jobs offered to new native hires was higher relative to the complexity of destructed native jobs. Finally, we find evidence that the occupation reallocation of natives was significantly larger in countries with more flexible labor laws. This tendency was particularly strong for less educated workers.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 17139.

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Date of creation: Jun 2011
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Publication status: published as “Immigration, Jobs and Labor Market Institutions: Evidence from Europe” (with F. D’Amuri) forthcoming Journal of European Economic Association,.
Handle: RePEc:nbr:nberwo:17139

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  1. Simonetta Longhi & Peter Nijkamp & Jacques Poot, 2005. "A Meta-Analytic Assessment of the Effect of Immigration on Wages," Journal of Economic Surveys, Wiley Blackwell, Wiley Blackwell, vol. 19(3), pages 451-477, 07.
  2. Libertad Gonzalez & Francesc Ortega, 2008. "How do Very Open Economies Absorb Large Immigration Flows? Recent Evidence from Spanish Regions," Development Working Papers 248, Centro Studi Luca d\'Agliano, University of Milano.
  3. 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.
  4. Christian Dustmann & Tommaso Frattini & Ian Preston, 2008. "The Effect of Immigration along the Distribution of Wages," CReAM Discussion Paper Series 0803, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  5. David Card, 2009. "Immigration and Inequality," NBER Working Papers 14683, National Bureau of Economic Research, Inc.
  6. Giovanni Peri & Chad Sparber, 2008. "Task Specialisation, Immigration and Wages," Development Working Papers 252, Centro Studi Luca d\'Agliano, University of Milano.
  7. Joseph Altonji & David Card, 1989. "The Effects of Immigration on the Labor Market Outcome of Less-Skilled Natives," Working Papers, Princeton University, Department of Economics, Industrial Relations Section. 636, Princeton University, Department of Economics, Industrial Relations Section..
  8. George J. Borjas & Lawrence F. Katz, 2007. "The Evolution of the Mexican-Born Workforce in the United States," NBER Chapters, in: Mexican Immigration to the United States, pages 13-56 National Bureau of Economic Research, Inc.
  9. Patricia Cort�s & Jos� Tessada, 2011. "Low-Skilled Immigration and the Labor Supply of Highly Skilled Women," American Economic Journal: Applied Economics, American Economic Association, American Economic Association, vol. 3(3), pages 88-123, July.
  10. David Autor & Frank Levy & Richard Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, Federal Reserve Bank of San Francisco, issue Nov.
  11. Frederic DOCQUIER & Çaglar OZDEN & Giovanni PERI, 2010. "The Wage Effects of Immigration and Emigration," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales), Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) 2010044, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  12. Ortega, Francesc & Peri, Giovanni, 2011. "The Aggregate Effects of Trade and Migration: Evidence from OECD Countries," IZA Discussion Papers 5604, Institute for the Study of Labor (IZA).
  13. Acemoglu, Daron & Autor, David, 2011. "Skills, Tasks and Technologies: Implications for Employment and Earnings," Handbook of Labor Economics, Elsevier, Elsevier.
  14. George J. Borjas, 2003. "The Labor Demand Curve Is Downward Sloping: Reexamining The Impact Of Immigration On The Labor Market," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 118(4), pages 1335-1374, November.
  15. Alan S. Blinder, 2006. "Preparing America’s Workforce: Are We Looking in the Rear-View Mirror?," Working Papers, Princeton University, Department of Economics, Center for Economic Policy Studies. 67, Princeton University, Department of Economics, Center for Economic Policy Studies..
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Cited by:
  1. Sara de la Rica & Albretch Glitz & Francesc Ortega, 2013. "Immigration in Europe: Trends, Policies and Empirical Evidence," Working Papers 2013-16, FEDEA.
  2. Labanca, Claudio, 2014. "The effects of a temporary migration shock. The case of the Arab Spring migration toward Italy," University of California at San Diego, Economics Working Paper Series, Department of Economics, UC San Diego qt8m49f3qb, Department of Economics, UC San Diego.
  3. Ortega, Francesc & Polavieja, Javier G., 2012. "Labor-market exposure as a determinant of attitudes toward immigration," Labour Economics, Elsevier, Elsevier, vol. 19(3), pages 298-311.
  4. Stephan Brunow & Bastian Stockinger, 2013. "Establishments' and Regions' Cultural Diversity as a Source of Innovation: Evidence from Germany," Norface Discussion Paper Series, Norface Research Programme on Migration, Department of Economics, University College London 2013022, Norface Research Programme on Migration, Department of Economics, University College London.
  5. Bryan Caplan, 2012. "Why Should We Restrict Immigration?," Cato Journal, Cato Journal, Cato Institute, Cato Journal, Cato Institute, vol. 32(1), pages 5-24, Winter.
  6. Christian Dustmann & Tommaso Frattini, 2012. "Immigration: The European Experience," Norface Discussion Paper Series, Norface Research Programme on Migration, Department of Economics, University College London 2012001, Norface Research Programme on Migration, Department of Economics, University College London.
  7. Frattini, T. (Tommaso), 2012. "GINI DP 44: Immigration and Inequality in Europe," GINI Discussion Papers, AIAS, Amsterdam Institute for Advanced Labour Studies 44, AIAS, Amsterdam Institute for Advanced Labour Studies.
  8. Isabell Koske & Jean-Marc Fournier & Isabelle Wanner, 2012. "Less Income Inequality and More Growth – Are They Compatible? Part 2. The Distribution of Labour Income," OECD Economics Department Working Papers 925, OECD Publishing.

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