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Immigration, occupational choice and public employment

Author

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  • Luca Marchiori
  • Patrice Pieretti
  • Benteng Zou

Abstract

This paper investigates the theoretical effects of immigration in an occupational choice model with three sectors: a low-skilled, a high-skilled and a public sector. The originality of our approach is to consider (i) intersectoral mobility of labor and (ii) public employment. We highlight the fact that including a public sector is crucial, since omitting it implies that low-skilled immigration unambiguously reduces wages and welfare of all workers. However, when public employment is considered, we demonstrate that immigration increases wages in the high-skilled and the public sectors, provided that the immigrant workforce is not too large and the access to public jobs is not too easy. The average wage of natives may also increase accordingly. Moreover, immigration may improve workers? welfare in each sector. Finally, the mechanism underlying these results does not require complementarity between natives and immigrants.

Suggested Citation

  • Luca Marchiori & Patrice Pieretti & Benteng Zou, 2015. "Immigration, occupational choice and public employment," BCL working papers 96, Central Bank of Luxembourg.
    • Handle: RePEc:bcl:bclwop:bclwp096
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    Cited by:

    1. Fabien Prieur & Ingmar Schumacher, 2016. "The role of conflict for optimal climate and immigration policy," Working Papers 2016.27, FAERE - French Association of Environmental and Resource Economists.

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    More about this item

    Keywords

    Immigration; occupational choice model; public employment;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets
    • H44 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Goods: Mixed Markets

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