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The Labor Demand Curve Is Downward Sloping: Reexamining The Impact Of Immigration On The Labor Market

In: Foundational Essays in Immigration Economics

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  • GEORGE J. BORJAS

Abstract

Immigration is not evenly balanced across groups of workers who have the same education but differ in their work experience, and the nature of the supply imbalance changes over time. This paper develops a new approach for estimating the labor market impact of immigration by exploiting this variation in supply shifts across education-experience groups. I assume that similarly educated workers with different levels of experience participate in a national labor market and are not perfect substitutes. The analysis indicates that immigration lowers the wage of competing workers: a 10 percent increase in supply reduces wages by 3 to 4 percent.

Suggested Citation

  • 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..
    • Handle: RePEc:wsi:wschap:9789811240812_0009
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    1. Chinhui Juhn & Kevin M. Murphy & Robert H. Topel, 1991. "Why Has the Natural Rate of Unemployment Increased over Time?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(2), pages 75-142.
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    More about this item

    Keywords

    Immigration; Economics; Labor Markets; Refugees; Self-selection; Return Migration; Migration; Costs and Benefits from Immigration; Assimilation; Cohort Effects; National Origin; Ethnicity; Neighborhood Effects; Ethnic Capital; Internal Migration;
    All these keywords.

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • F66 - International Economics - - Economic Impacts of Globalization - - - Labor

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