IDEAS home Printed from https://ideas.repec.org/a/ris/invreg/0091.html
   My bibliography  Save this article

Immigration and Firm Performance: a city-level approach

Author

Listed:
  • Teruel Carrizosa , Mercedes

    (Industry and Territory Research Group. Department of Economics (Rovira i Virgili University))

  • Segarra Blasco , Agustí

    (Industry and Territory Research Group. Department of Economics (Rovira i Virgili University))

Abstract

This article analyses the effect of immigration flows on the growthand efficiency of manufacturing firms in Spanish cities. While most studies werefocusing on the effect immigrants have on labour markets at an aggregate level,here, we argue that the impact of immigration on firm performance should not onlybe considered in terms of the labour market, but also in terms of how city’s amenitiescan affect the performance of firms. Implementing a panel data methodology,we show that the immigrants’ increasing pressure has a positive effect on labourproductivity and wages and a negative effect on the job evolution of these manufacturingfirms. In addition, both small and new firms are more sensitive to thepressures of immigrant inflow, while foreign market oriented firms report higherproductivity levels and a less marked impact of immigration than their counterparts.We also present a set of instruments to control for endogeneity. It allows us toconfirm the effect of local immigration flows on the performance of manufacturingfirms.

Suggested Citation

  • Teruel Carrizosa , Mercedes & Segarra Blasco , Agustí, 2009. "Immigration and Firm Performance: a city-level approach," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 15, pages 111-137.
    • Handle: RePEc:ris:invreg:0091
    as

    Download full text from publisher

    File URL: http://www.aecr.org/images/ImatgesArticles/2009/TeruelySegarra.pdf
    File Function: Full text
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Gilles Duranton & Michael Storper, 2006. "Agglomeration and growth: a dialogue between economists and geographers," Journal of Economic Geography, Oxford University Press, vol. 6(1), pages 1-7, January.
    2. Gilles Duranton & Diego Puga, 2001. "Nursery Cities: Urban Diversity, Process Innovation, and the Life Cycle of Products," American Economic Review, American Economic Association, vol. 91(5), pages 1454-1477, December.
    3. Luís M B Cabral & José Mata, 2003. "On the Evolution of the Firm Size Distribution: Facts and Theory," American Economic Review, American Economic Association, vol. 93(4), pages 1075-1090, September.
    4. John M. Quigley, 1998. "Urban Diversity and Economic Growth," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 127-138, Spring.
    5. Sanford J. Grossman, 1982. "A Transactions Based Model of the Monetary Transmission Mechanism: Part 2," NBER Working Papers 0974, National Bureau of Economic Research, Inc.
    6. Gerke J. Hoogstra & Jouke van Dijk, 2004. "Explaining Firm Employment Growth: Does Location Matter?," Small Business Economics, Springer, vol. 22(3_4), pages 179-192, April.
    7. Gianmarco I.P. Ottaviano & Giovanni Peri, 2021. "The economic value of cultural diversity: evidence from US cities," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 7, pages 187-222, World Scientific Publishing Co. Pte. Ltd..
    8. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
    9. Myriam Quispe-Agnoli & Madeline Zavodny, 2002. "The effect of immigration on output mix, capital, and productivity," Economic Review, Federal Reserve Bank of Atlanta, vol. 87(Q1), pages 17-27.
    10. Fotopoulos, Georgios & Louri, Helen, 2000. "Location and Survival of New Entry," Small Business Economics, Springer, vol. 14(4), pages 311-321, June.
    11. Giorgio Fagiolo & Alessandra Luzzi, 2006. "Do liquidity constraints matter in explaining firm size and growth? Some evidence from the Italian manufacturing industry," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 15(1), pages 1-39, February.
    12. George J. Borjas, 2021. "The Labor Demand Curve Is Downward Sloping: Reexamining The Impact Of Immigration On The Labor Market," World Scientific Book Chapters, in: Foundational Essays in Immigration Economics, chapter 9, pages 235-274, World Scientific Publishing Co. Pte. Ltd..
    13. Rosen, Sherwin, 1974. "Hedonic Prices and Implicit Markets: Product Differentiation in Pure Competition," Journal of Political Economy, University of Chicago Press, vol. 82(1), pages 34-55, Jan.-Feb..
    14. Edward L. Glaeser & Joseph Gyourko, 2005. "Urban Decline and Durable Housing," Journal of Political Economy, University of Chicago Press, vol. 113(2), pages 345-375, April.
    15. Paul, Catherine J Morrison & Siegel, Donald S, 2001. " The Impacts of Technology, Trade and Outsourcing on Employment and Labor Composition," Scandinavian Journal of Economics, Wiley Blackwell, vol. 103(2), pages 241-264, June.
    16. Christian Dustmann & Francesca Fabbri & Ian Preston, 2005. "The Impact of Immigration on the British Labour Market," Economic Journal, Royal Economic Society, vol. 115(507), pages 324-341, November.
    17. Lundborg, Per & Segerstrom, Paul S., 2002. "The growth and welfare effects of international mass migration," Journal of International Economics, Elsevier, vol. 56(1), pages 177-204, January.
    18. Georgios Fotopoulos & Helen Louri, 2000. "Determinants of Hazard Confronting New Entry: Does Financial Structure Matter?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 17(3), pages 285-300, November.
    19. José Calvo, 2006. "Testing Gibrat’s Law for Small, Young and Innovating Firms," Small Business Economics, Springer, vol. 26(2), pages 117-123, March.
    20. Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-1278, December.
    21. Douglas J. Krupka & Kwame N. Donaldson, 2013. "Wages, Rents, And Heterogeneous Moving Costs," Economic Inquiry, Western Economic Association International, vol. 51(1), pages 844-864, January.
    22. Sukkoo Kim, 2007. "Immigration, Industrial Revolution and Urban Growth in the United States, 1820-1920: Factor Endowments, Technology and Geography," NBER Working Papers 12900, National Bureau of Economic Research, Inc.
    23. Alessandra Faggian & Philip McCann, 2006. "Human capital flows and regional knowledge assets: a simultaneous equation approach," Oxford Economic Papers, Oxford University Press, vol. 58(3), pages 475-500, July.
    24. Winter-Ebmer, Rudolf & Zweimuller, Josef, 1996. "Immigration and the Earnings of Young Native Workers," Oxford Economic Papers, Oxford University Press, vol. 48(3), pages 473-491, July.
    25. Gyourko, Joseph & Kahn, Matthew & Tracy, Joseph, 1999. "Quality of life and environmental comparisons," Handbook of Regional and Urban Economics, in: P. C. Cheshire & E. S. Mills (ed.), Handbook of Regional and Urban Economics, edition 1, volume 3, chapter 37, pages 1413-1454, Elsevier.
    26. José Fariñas & Lourdes Moreno, 2000. "Firms' Growth, Size and Age: A Nonparametric Approach," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 17(3), pages 249-265, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Nicodemo, Catia, 2013. "Immigration and Labor Productivity: New Empirical Evidence for Spain," IZA Discussion Papers 7297, Institute of Labor Economics (IZA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mercedes Teruel-Carrizosa & Agustí Segarra-Blasco, 2008. "Immigration and Firm Growth: Evidence from Spanish cities," Working Papers XREAP2008-11, Xarxa de Referència en Economia Aplicada (XREAP), revised Nov 2008.
    2. Nicodemo, Catia, 2013. "Immigration and Labor Productivity: New Empirical Evidence for Spain," IZA Discussion Papers 7297, Institute of Labor Economics (IZA).
    3. Gianmarco I.P. Ottaviano & Giovanni Peri, 2021. "The economic value of cultural diversity: evidence from US cities," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 7, pages 187-222, World Scientific Publishing Co. Pte. Ltd..
    4. Nathan, Max, 2013. "The Wider Economic Impacts of High-Skilled Migrants: A Survey of the Literature," IZA Discussion Papers 7653, Institute of Labor Economics (IZA).
    5. Gianmarco I.P. Ottaviano & Giovanni Peri, 2021. "Cities and cultures," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 6, pages 153-186, World Scientific Publishing Co. Pte. Ltd..
    6. Douglas J. Krupka, 2009. "Location‐Specific Human Capital, Location Choice And Amenity Demand," Journal of Regional Science, Wiley Blackwell, vol. 49(5), pages 833-854, December.
    7. Thomas Kemeny, 2013. "Immigrant Diversity and Economic Development in Cities: A Critical Review," SERC Discussion Papers 0149, Centre for Economic Performance, LSE.
    8. Dr Max Nathan, 2013. "The wider economic impacts of high-skilled migrants: a survey of the literature," National Institute of Economic and Social Research (NIESR) Discussion Papers 413, National Institute of Economic and Social Research.
    9. Nathan, Max, 2013. "The Wider Economic Impacts of High-Skilled Migrants: A Survey of the Literature," IZA Discussion Papers 7653, Institute of Labor Economics (IZA).
    10. Duranton, Gilles & Puga, Diego, 2014. "The Growth of Cities," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 5, pages 781-853, Elsevier.
    11. Coad, Alex & Segarra, Agustí & Teruel, Mercedes, 2013. "Like milk or wine: Does firm performance improve with age?," Structural Change and Economic Dynamics, Elsevier, vol. 24(C), pages 173-189.
    12. Luisa Gagliardi, 2015. "Does skilled migration foster innovative performance? Evidence from British local areas," Papers in Regional Science, Wiley Blackwell, vol. 94(4), pages 773-794, November.
    13. Thomas Kemeny & Abigail Cooke, 2018. "Spillovers from immigrant diversity in cities," Journal of Economic Geography, Oxford University Press, vol. 18(1), pages 213-245.
    14. Bonin, Holger, 2017. "The Potential Economic Benefits of Education of Migrants in the EU," IZA Research Reports 75, Institute of Labor Economics (IZA).
    15. Jens Ruhose, 2015. "Microeconometric Analyses on Economic Consequences of Selective Migration," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 61.
    16. Rodríguez-Pose, Andrés & Von Berlepsch, Viola, 2017. "Does population diversity matter for economic development in the very long-term? Historic migration, diversity and county wealt," CEPR Discussion Papers 12347, C.E.P.R. Discussion Papers.
    17. Andrés Rodríguez-Pose & Viola Berlepsch, 2019. "Does Population Diversity Matter for Economic Development in the Very Long Term? Historic Migration, Diversity and County Wealth in the US," European Journal of Population, Springer;European Association for Population Studies, vol. 35(5), pages 873-911, December.
    18. Kahn, Matthew E. & Walsh, Randall, 2015. "Cities and the Environment," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 405-465, Elsevier.
    19. Bond, Timothy N. & Giuntella, Osea & Lonsky, Jakub, 2023. "Immigration and work schedules: Theory and evidence," European Economic Review, Elsevier, vol. 152(C).
    20. Douglas J. Krupka & Kwame N. Donaldson, 2013. "Wages, Rents, And Heterogeneous Moving Costs," Economic Inquiry, Western Economic Association International, vol. 51(1), pages 844-864, January.

    More about this item

    Keywords

    Firm growth; firm location; regional effects;
    All these keywords.

    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:invreg:0091. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: IIRR-JORR (email available below). General contact details of provider: https://edirc.repec.org/data/aecrrea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.