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The Labor Demand Curve is Downward Sloping: Reexamining the Impact of Immigration on the Labor Market

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  • George J. Borjas

Abstract

Immigration is not evenly balanced across groups of workers that have the same education but differ in their work experience, and the nature of the supply imbalance changes over time. This paper develops a new approach for estimating the labor market impact of immigration by exploiting this variation in supply shifts across education-experience groups. I assume that similarly educated workers with different levels of experience participate in a national labor market and are not perfect substitutes. The analysis indicates that immigration lowers the wage of competing workers: a 10 percent increase in supply reduces wages by 3 to 4 percent.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 9755.

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Date of creation: Jun 2003
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Publication status: published as Borjas, George J. "The Labor Demand Curve is Downward Sloping: Reexamining the Impact of Immigration on the Labor Market," Quarterly Journal of Economics 118(4): 1335-1374, November 2003
Handle: RePEc:nbr:nberwo:9755

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  1. Chinhui Juhn & Kevin M. Murphy & Robert H. Topel, 1991. "Why Has the Natural Rate of Unemployment Increased over Time?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(2), pages 75-142.
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