The Effect of a Culturally Diverse Population on Regional Income in EU Regions
AbstractAfter the crisis years of 2008 and 2009 EU countries followed different employment paths. Employment and wage levels, for instance, are quite unevenly distributed across Europe. Some of the EU countries expect labour shortages due to demographic change in the future. If this is the case, wages will rise when the shortages occur. From literature on migration it is well known that regions with relatively higher income levels and a lower risk of unemployment are typical destination countries for immigration. Thus, European regions might be expected to become rather mixed in cultural terms in the future. Despite the filling of the labour market and the redistribution of the resource of labour, the ultimate question raised in the discussion is whether there are additional gains or losses due to immigration. This work therefore focuses on the impact of migrants on regional GDP per capita for European regions. Does the proportion of foreigners in the labour force increase or lower regional income? Does the composition of non-natives with respect to their countries of origin matter? Both questions are addressed in this study while controlling for endogeneity. We provide evidence that immigration raises regional income and a tendency towards (roughly classified) dominant foreign-born groups reduces the costs of interaction and integration. Thus, in general immigration has a positive effect on regional performance and the costs of immigration in destination regions are balanced out. Depending on the labour market status of migrants, the regions of origin of migrants within the EU face a rise or decline in income as a result of the outflow.
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 WIFO in its series WIFO Working Papers with number 413.
Length: 30 pages
Date of creation: 01 Dec 2011
Date of revision:
Regional Income; Cultural Diversity; Effects of Immigration;
Other versions of this item:
- Stephan Brunow & Hanna Brenzel, 2011. "The effect of a culturally diverse population on regional income in EU regions," Norface Discussion Paper Series 2011021, Norface Research Programme on Migration, Department of Economics, University College London.
- NEP-ALL-2011-12-13 (All new papers)
- NEP-EUR-2011-12-13 (Microeconomic European Issues)
- NEP-GEO-2011-12-13 (Economic Geography)
- NEP-MIG-2011-12-13 (Economics of Human Migration)
- NEP-URE-2011-12-13 (Urban & Real Estate Economics)
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.:
- Giovanni Prarolo & Elena Bellini & Gianmarco I.P. Ottaviano & Dino Pinelli, 2009.
"Cultural Diversity and Economic Performance: Evidence from European Regions,"
2009.63, Fondazione Eni Enrico Mattei.
- Bellini, Elena & Ottaviano, Gianmarco I. P. & Pinelli, Dino & Prarolo, Giovanni, 2008. "Cultural diversity and economic performance: Evidence from European regions," HWWI Research Papers 3-14, Hamburg Institute of International Economics (HWWI).
- Alberto Alesina & Eliana La Ferrara, 2004.
"Ethnic Diversity and Economic Performance,"
NBER Working Papers
10313, National Bureau of Economic Research, Inc.
- Alberto Alesina & Eliana La Ferrara, 2003. "Ethnic Diversity and Economic Performance," Harvard Institute of Economic Research Working Papers 2028, Harvard - Institute of Economic Research.
- Alberto Alesina & Eliana La Ferrara, 2004. "Ethnic Diversity and Economic Performance," Development Working Papers 193, Centro Studi Luca d\'Agliano, University of Milano.
- Francesco Caselli & Gerardo Esquivel & Fernando Lefort, 1997.
"Reopening the Convergence Debate: A New Look at Cross-Country Growth Empirics,"
Working Papers Central Bank of Chile
03, Central Bank of Chile.
- Caselli, Francesco & Esquivel, Gerardo & Lefort, Fernando, 1996. " Reopening the Convergence Debate: A New Look at Cross-Country Growth Empirics," Journal of Economic Growth, Springer, vol. 1(3), pages 363-89, September.
- Paul Collier, 2001. "Implications of ethnic diversity," Economic Policy, CEPR & CES & MSH, vol. 16(32), pages 127-166, 04.
- Brunow, Stephan & Hirte, Georg, 2005. "Age Structure and Regional Income Growth," Discussion Papers 1/2005, Dresden University of Technology, Faculty of Transportation and Traffic Sciences "Friedrich List", Institute for Transport and Economics.
- Dirk Dohse & Robert Gold, 2013. "Measuring Cultural Diversity at a Regional Level," WWWforEurope Working Papers series 10, WWWforEurope.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ilse Schulz).
If references are entirely missing, you can add them using this form.