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Restrictive Immigration Policy in Germany: Pains and Gains Foregone?

Author Info

Listed author(s):
  • Gabriel J. Felbermayr
  • Wido Geis
  • Wilhelm Kohler

Abstract

Many European countries restrict immigration from new EU member countries. The rationale is to avoid adverse wage and employment effects. We quantify these effects for Germany. Following Borjas (2003), we estimate a structural model of labor demand, based on elasticities of substitution between workers with different experience levels and education. We allow for unemployment which we model in a price-wage-setting framework. Simulating a counterfactual scenario without restrictions for migration from new EU members countries, we find moderate negative wage effects, combined with increased unemployment for some types of workers. Wage-setting mitigates wage cuts.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2008/wp-cesifo-2008-05/cesifo1_wp2316.pdf
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2316.

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Date of creation: 2008
Handle: RePEc:ces:ceswps:_2316
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Keywords: migration; labor;

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Find related papers by JEL classification:
  • F20 - International Economics - - International Factor Movements and International Business - - - General
  • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

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  1. Marco Manacorda & Alan Manning & Jonathan Wadsworth, 2006. "The impact of immigration on the structure of male wages: theory and evidence from Britain," LSE Research Online Documents on Economics 19797, London School of Economics and Political Science, LSE Library.
  2. Blanchflower, David G. & Oswald, Andrew J., 2005. "The Wage Curve Reloaded," IZA Discussion Papers 1665, Institute for the Study of Labor (IZA).
  3. George J. Borjas, 1995. "The Economic Benefits from Immigration," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 3-22, Spring.
  4. David Card, 1990. "The Impact of the Mariel Boatlift on the Miami Labor Market," ILR Review, Cornell University, ILR School, vol. 43(2), pages 245-257, January.
  5. David Card & Thomas Lemieux, 2001. "Can Falling Supply Explain the Rising Return to College for Younger Men? A Cohort-Based Analysis," The Quarterly Journal of Economics, Oxford University Press, vol. 116(2), pages 705-746.
  6. Abdurrahman Aydemir & George J. Borjas, 2007. "Cross-Country Variation in the Impact of International Migration: Canada, Mexico, and the United States," Journal of the European Economic Association, MIT Press, vol. 5(4), pages 663-708, 06.
  7. Borjas, George J & Freeman, Richard B & Katz, Lawrence, 1996. "Searching for the Effect of Immigration on the Labor Market," American Economic Review, American Economic Association, vol. 86(2), pages 246-251, May.
  8. D'Amuri, Francesco & Ottaviano, Gianmarco I.P. & Peri, Giovanni, 2010. "The labor market impact of immigration in Western Germany in the 1990s," European Economic Review, Elsevier, vol. 54(4), pages 550-570, May.
  9. Gabriel J Felbermayr & Wilhelm Kohler, 2014. "Immigration and Native Welfare," World Scientific Book Chapters,in: European Economic Integration, WTO Membership, Immigration and Offshoring, chapter 10, pages 335-372 World Scientific Publishing Co. Pte. Ltd..
  10. Borjas, George J., 1999. "The economic analysis of immigration," Handbook of Labor Economics,in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 28, pages 1697-1760 Elsevier.
  11. Zaiceva, Anzelika, 2006. "Reconciling the Estimates of Potential Migration into the Enlarged European Union," IZA Discussion Papers 2519, Institute for the Study of Labor (IZA).
  12. Brücker, Herbert & Jahn, Elke J., 2008. "Migration and the Wage Curve: A Structural Approach to Measure the Wage and Employment Effects of Migration," IZA Discussion Papers 3423, Institute for the Study of Labor (IZA).
  13. Ethier, Wilfred J, 1985. "International Trade and Labor Migration," American Economic Review, American Economic Association, vol. 75(4), pages 691-707, September.
  14. George J. Borjas & Jeffrey Grogger & Gordon H. Hanson, 2008. "Imperfect Substitution between Immigrants and Natives: A Reappraisal," NBER Working Papers 13887, National Bureau of Economic Research, Inc.
  15. Hans-Werner Sinn & Gebhard Flaig & Martin Werding & Sonja Munz & Nicola Düll & Herbert Hofmann, 2001. "EU-Erweiterung und Arbeitskräftemigration : Wege zu einer schrittweisen Annäherung der Arbeitsmärkte," ifo Beiträge zur Wirtschaftsforschung, Ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 2.
  16. Gianmarco I. P. Ottaviano & Giovanni Peri, 2012. "Rethinking The Effect Of Immigration On Wages," Journal of the European Economic Association, European Economic Association, vol. 10(1), pages 152-197, 02.
  17. Berry, R Albert & Soligo, Ronald, 1969. "Some Welfare Aspects of International Migration," Journal of Political Economy, University of Chicago Press, vol. 77(5), pages 778-794, Sept./Oct.
  18. George J. Borjas, 2003. "The Labor Demand Curve is Downward Sloping: Reexamining the Impact of Immigration on the Labor Market," NBER Working Papers 9755, National Bureau of Economic Research, Inc.
  19. George J. Borjas, 2003. "The Labor Demand Curve is Downward Sloping: Reexamining the Impact of Immigration on the Labor Market," The Quarterly Journal of Economics, Oxford University Press, vol. 118(4), pages 1335-1374.
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