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The impact of immigration on the French labor market: Why so different?

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  • Ortega, Javier
  • Verdugo, Gregory

Abstract

Combining large (up to 25%) extracts of five French censuses and data from Labor Force Surveys for 1968–1999, we use Borjas' (2003) factor proportions methodology for France and find that a 10 p.p. increase in the immigrant share raises natives' wages by 3.3%, which is in stark contrast with the results in Borjas (2003) for the U.S. The positive impact of immigration on natives' wages and employment is shown to hold also at the regional level. We find evidence that this positive correlation partly comes from the imperfect substitutability of natives and immigrants within education/experience cells. Specifically, (i) the occupational distribution of natives and immigrants within these cells is more dissimilar when there are more immigrants in the cell; (ii) natives tend to perform more abstract tasks when there are more immigrants in the cell; and (iii) an important part of the positive relation between immigration and wages comes from a reallocation of natives to better-paid occupations within the cells. However, we argue that this positive correlation is also likely to be related to the inability of the Borjas (2003) model to perfectly account for the important changes in the wage distribution and the educational level characterizing the French economy in this period.

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  • Ortega, Javier & Verdugo, Gregory, 2014. "The impact of immigration on the French labor market: Why so different?," Labour Economics, Elsevier, vol. 29(C), pages 14-27.
  • Handle: RePEc:eee:labeco:v:29:y:2014:i:c:p:14-27
    DOI: 10.1016/j.labeco.2014.05.002
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    5. Nedoncelle, Clément & Marchal, Léa & Aubry, Amandine & Héricourt, Jérôme, 2024. "Does immigration affect native wages? A meta-analysis," KCG Working Papers 31, Kiel Centre for Globalization (KCG).
    6. David Dorn & Josef Zweimüller, 2021. "Migration and Labor Market Integration in Europe," Journal of Economic Perspectives, American Economic Association, vol. 35(2), pages 49-76, Spring.
    7. Stuhler, Jan & Jaeger, David & Ruist, Joakim, 2018. "Shift-Share Instruments and the Impact of Immigration," CEPR Discussion Papers 12701, C.E.P.R. Discussion Papers.
    8. Theo Sparreboom & Jesse Mertens & Sandra Berger, 2020. "The Labour Market Impact of Immigration in Three Sub-Saharan African Economies," Journal of International Migration and Integration, Springer, vol. 21(4), pages 1225-1248, December.
    9. Thomas Kemeny & Abigail Cooke, 2018. "Spillovers from immigrant diversity in cities," Journal of Economic Geography, Oxford University Press, vol. 18(1), pages 213-245.
    10. Joel OUDINET, 2021. "Introduction - L’impact de la migration sur le développement inclusif," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 53, pages 5-21.
    11. Ortega, Javier & Verdugo, Gregory, 2016. "Moving Up or Down? Immigration and the Selection of Natives across Occupations and Locations," IZA Discussion Papers 10303, Institute of Labor Economics (IZA).
    12. Stelios Roupakias & Michael Chletsos, 2020. "Immigration and far-right voting: evidence from Greece," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 65(3), pages 591-617, December.
    13. Ortega, J. & Verdugo, G., 2015. "The Impact of Immigration on the Local Labor Market Outcomes of Blue Collar Workers: Panel Data Evidence," Working Papers 15/07, Department of Economics, City University London.
    14. Edo, Anthony & Rapoport, Hillel, 2019. "Minimum wages and the labor market effects of immigration," Labour Economics, Elsevier, vol. 61(C).
    15. Jamal Bouoiyour & Amal Miftah & Refk Selmi, 2019. "The economic contribution of immigration on Europe: Fresh evidence from a “hybrid” quantile regression model," Working Papers hal-02346700, HAL.
    16. Chletsos Michael & Roupakias Stelios, 2019. "Do Immigrants Compete with Natives in the Greek Labour Market? Evidence from the Skill-Cell Approach before and during the Great Recession," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 19(2), pages 1-30, April.
    17. Ciorbagiu Ioana & Stoica Adrian & Mihaila Monica, 2020. "Life Satisfaction and Migration - What Relationship?," Journal of Social and Economic Statistics, Sciendo, vol. 9(1), pages 105-127, August.
    18. Hyejin Kim, 2020. "Wage and Employment Effects of Immigration: Evidence from Korea," Working Papers 2020-30, Economic Research Institute, Bank of Korea.
    19. Joel Oudinet, 2021. "L’impact de la migration sur le développement inclusif," Post-Print hal-04065384, HAL.
    20. Hippolyte d'Albis & Ekrame Boubtane & Dramane Coulibaly, 2015. "Immigration Policy and Macroeconomic Performance in France," Working Papers halshs-01162441, HAL.
    21. Anthony Edo, 2016. "How do rigid labor markets absorb immigration? Evidence from France," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-20, December.
    22. Auer, Daniel & Götz, Lilia, 2021. "Refugee migration, labor demand, and local employment," GLO Discussion Paper Series 989, Global Labor Organization (GLO).

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    More about this item

    Keywords

    Immigration; Labor market impact; France;
    All these keywords.

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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