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How do very open economies adjust to large immigration flows? Recent evidence from Spanish regions

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Abstract

In recent years, Spain has received unprecedented immigration flows. Between 2001 and 2006 the fraction of the population born abroad more than doubled, increasing from 4.8% to 10.8%. For Spanish provinces with above-median inflows (relative to population), immigration increased by 24% the number of high school dropouts while only increasing college graduates by 11%. We study different channels by which regional labor markets have absorbed the large increase in relative supply of low educated workers. We identify the exogenous supply shock using historical immigrant settlement patterns by country of origin. Using data from the Labor Force Survey and the decennial Census, we find a large expansion of employment in high immigration regions. Disaggregating by industry, the absorption operated through large increases in the share of low-educated workers, compared to the same industry in low-immigration regions. We do not find changes in sectoral specialization. Overall, and perhaps surprisingly, the pattern of absorption is very similar to the one found in the US.

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Bibliographic Info

Paper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 1059.

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Date of creation: Nov 2007
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Handle: RePEc:upf:upfgen:1059

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Web page: http://www.econ.upf.edu/

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Keywords: Immigration; Open Economies; Rybcszynski; Instrumental Variables;

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  1. Albert Saiz, 2003. "Room in the Kitchen for the Melting Pot: Immigration and Rental Prices," The Review of Economics and Statistics, MIT Press, vol. 85(3), pages 502-521, August.
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Cited by:
  1. M. Angeles Carnero Fernández & Lídia Farré Olalla & Mariano Bosch, 2011. "Rental housing discrimination and the persistence of ethnic enclaves," Working Papers. Serie AD 2011-10, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  2. Libertad Gonzalez & Francesc Ortega, 2013. "Immigration And Housing Booms: Evidence From Spain," Journal of Regional Science, Wiley Blackwell, vol. 53(1), pages 37-59, 02.
  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. Giulia Bettin & Alessia Lo Turco & Daniela Maggioni, 2012. "A Firm-Level Perspective on Migration," Development Working Papers 328, Centro Studi Luca d\'Agliano, University of Milano, revised 27 Mar 2012.
  5. Javier Vázquez-Grenno, 2012. "Job search methods in times of crisis: native and immigrant strategies in Spain," Working Papers 2012/19, Institut d'Economia de Barcelona (IEB).
  6. Jordi Jofre-Monseny & Pilar Sorribas-Navarro & Javier Vázquez-Grenno, 2011. "Welfare spending and ethnic heterogeneity: evidence from a massive immigration wave," Working Papers 2011/34, Institut d'Economia de Barcelona (IEB).

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