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Estimating the effects of immigration in one city

Author

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  • Wing Suen

    () (School of Economics and Finance, The University of Hong Kong, Pokfulam Road, Hong Kong)

Abstract

This paper presents a new method of estimating the effects of immigration on the labor market that does not require variations in immigration across cities. With a two-stage CES model that aggregates immigrant groups by age cohorts and aggregates cohorts into effective labor, the econometric estimation and the interpretation of parameters are particularly straightforward. The paper uses data from Hong Kong to estimate the elasticities of complementarity associated with increased immigration. A simulation study indicates that a 40% increase in the stock of new immigrants will lower wages by no more than one percent.

Suggested Citation

  • Wing Suen, 2000. "Estimating the effects of immigration in one city," Journal of Population Economics, Springer;European Society for Population Economics, vol. 13(1), pages 99-112.
  • Handle: RePEc:spr:jopoec:v:13:y:2000:i:1:p:99-112 Note: Received: 13 August 1997/Accepted: 7 December 1998
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    Citations

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    Cited by:

    1. Bodvarsson, Örn B. & Van den Berg, Hendrik F. & Lewer, Joshua J., 2008. "Measuring immigration's effects on labor demand: A reexamination of the Mariel Boatlift," Labour Economics, Elsevier, vol. 15(4), pages 560-574, August.
    2. Eric Strobl & Marie-Anne Valfort, 2015. "The Effect of Weather-Induced Internal Migration on Local Labor Markets. Evidence from Uganda," World Bank Economic Review, World Bank Group, vol. 29(2), pages 385-412.
    3. Hon-Kwong Lui & Wing Suen, 2005. "The Shrinking Earnings Premium for University Graduates in Hong Kong: The Effect of Quantity or Quality?," Contemporary Economic Policy, Western Economic Association International, vol. 23(2), pages 242-254, April.
    4. Jun Han & Wing Suen, 2011. "Age structure of the workforce in growing and declining industries: evidence from Hong Kong," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(1), pages 167-189, January.
    5. Ou, Dongshu & Kondo, Ayako, 2012. "Immigrants and Earnings Inequality: Evidence from Hong Kong," MPRA Paper 39673, University Library of Munich, Germany.

    More about this item

    Keywords

    Immigrant-cohort size; two-stage CES model; elasticity of complementarity;

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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