The Dynamic Effects of Skilled Labour Targeting in Immigration Programs
AbstractWe consider the impact of the recent trend in immigration policies towards selecting migrants on the basis of skills. The analysis uses an inter-temporal general equilibrium model with endogenous skill formation. The model is calibrated to a steady state benchmark that represents Australia in 2000-2001. We then consider the impact of the increase in skilled migrants of approximately 20 thousand per year, which corresponds to the increase in flows of migrant Professionals in Australia since 2000. We find that this generates substantial crowding out of the higher Education sector in Australia. Moreover we show that, when this shock is anticipated as a permanent policy change, there is very little net increase in the stock of skilled labour due to falling student enrollments of 12%. Paradoxically, in this case, the decline in students increases the number of unskilled workers in the economy such that the ratio skilled to unskilled workers in the economy actually falls and the skill premium increases.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by School of Economics, The University of New South Wales in its series Discussion Papers with number 2007-21.
Length: 32 pages
Date of creation: Jul 2007
Date of revision:
Contact details of provider:
Postal: Australian School of Business Building, Sydney 2052
Fax: +61)-2- 9313- 6337
Web page: http://www.economics.unsw.edu.au/
More information through EDIRC
Immigration; Human Capital; Computable General Equilibrium Models;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-02-16 (All new papers)
- NEP-CMP-2008-02-16 (Computational Economics)
- NEP-EDU-2008-02-16 (Education)
- NEP-HRM-2008-02-16 (Human Capital & Human Resource Management)
- NEP-LAB-2008-02-16 (Labour Economics)
- NEP-MIG-2008-02-16 (Economics of Human Migration)
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.:
- Heather Antecol & Deborah A. Cobb-Clark & Stephen J. Trejo, 2004. "Selective immigration policy in Australia, Canada, and the United States," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 47(1), pages 57-76.
- George J. Borjas, 2004. "Do Foreign Students Crowd Out Native Students from Graduate Programs?," NBER Working Papers 10349, National Bureau of Economic Research, Inc.
- Cobb-Clark, Deborah A., 2004. "Selection Policy and the Labour Market Outcomes of New Immigrants," IZA Discussion Papers 1380, Institute for the Study of Labor (IZA).
- McCulloch, Rachel & Yellen, Janet L., 1975. "Consequences of a tax on the brain drain for unemployment and income inequality in less developed countries," Journal of Development Economics, Elsevier, vol. 2(3), pages 249-264, September.
- Bhagwati, Jagdish & Hamada, Koichi, 1974. "The brain drain, international integration of markets for professionals and unemployment : A theoretical analysis," Journal of Development Economics, Elsevier, vol. 1(1), pages 19-42, April.
- Timothy J. Hatton & Jeffrey G. Williamson, 2006.
"What Determines Immigration's Impact? Comparing Two Global Centuries,"
NBER Working Papers
12414, National Bureau of Economic Research, Inc.
- Hatton, Timothy J. & Williamson, Jeffrey G, 2006. "What Determines Immigrations' Impact? Comparing Two Global Centuries," CEPR Discussion Papers 5885, C.E.P.R. Discussion Papers.
- Stark, Oded & Wang, Yong, 2002.
"Inducing human capital formation: migration as a substitute for subsidies,"
Journal of Public Economics,
Elsevier, vol. 86(1), pages 29-46, October.
- Stark, Oded & Wang, Yong, 2001. "Inducing Human Capital Formation: Migration as a Substitute for Subsidies," Economics Series 100, Institute for Advanced Studies.
- Paul W. Miller, 1999. "Immigration Policy and Immigrant Quality: The Australian Points System," American Economic Review, American Economic Association, vol. 89(2), pages 192-197, May.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guillaume Roger) The email address of this maintainer does not seem to be valid anymore. Please ask Guillaume Roger to update the entry or send us the correct address.
If references are entirely missing, you can add them using this form.