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The Impact of Immigration on Wage Dynamics: Evidence from the Algerian Independence War

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  • Anthony Edo

Abstract

This paper investigates the dynamics of wage adjustment to an exogenous increase in labor supply by exploiting the sudden and unexpected inflow of repatriates to France created by the independence of Algeria in 1962. I track the impact of this particular supply shift on the average wage of pre-existing native workers across French regions in 1962, 1968 and 1976. I find that regional wages decline between 1962 and 1968, before returning to their pre-shock level 15 years after. While regional wages recovered, this particular supply shock had persistent distributional effects. By increasing the relative supply of high educated workers, the inflow of repatriates contributed to the reduction of wage inequality between high and low educated native workers over the whole period considered (1962-1976).

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  • Anthony Edo, 2017. "The Impact of Immigration on Wage Dynamics: Evidence from the Algerian Independence War," Working Papers 2017-13, CEPII research center.
    • Handle: RePEc:cii:cepidt:2017-13
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    Cited by:

    1. Amior, Michael, 2020. "The contribution of immigration to local labor market adjustment," LSE Research Online Documents on Economics 108419, London School of Economics and Political Science, LSE Library.
    2. Mark Colas & Dominik Sachs, 2020. "The Indirect Fiscal Benefits of Low-Skilled Immigration," CESifo Working Paper Series 8604, CESifo.
    3. Edo, Anthony & Giesing, Yvonne & Öztunc, Jonathan & Poutvaara, Panu, 2019. "Immigration and electoral support for the far-left and the far-right," European Economic Review, Elsevier, vol. 115(C), pages 99-143.
    4. Jinno, Masatoshi & Yasuoka, Masaya, 2021. "Endogenous fertility and unemployment -Considering the effects of immigrants through school system," MPRA Paper 106379, University Library of Munich, Germany.
    5. Anthony Edo & Lionel Ragot & Hillel Rapoport & Sulin Sardoschau & Andreas Steinmayr, 2018. "The Effects of Immigration in Developed Countries: Insights from Recent Economic Research," CEPII Policy Brief 2018-22, CEPII research center.
    6. Sachs, Dominik & Colas, Mark, 2020. "The Indirect Fiscal Benefits of Low-Skilled Immigration," CEPR Discussion Papers 15325, C.E.P.R. Discussion Papers.
    7. Mark Colas & Dominik Sachs, 2020. "The Indirect Fiscal Benefits of Low-Skilled Immigration," Opportunity and Inclusive Growth Institute Working Papers 38, Federal Reserve Bank of Minneapolis.
    8. Edo, Anthony & Rapoport, Hillel, 2019. "Minimum wages and the labor market effects of immigration," Labour Economics, Elsevier, vol. 61(C).
    9. Mark Colas, 2018. "Dynamic Responses to Immigration," Opportunity and Inclusive Growth Institute Working Papers 6, Federal Reserve Bank of Minneapolis.
    10. Tao Song & Huanan Xu, 2020. "Anywhere they go, we go: Immigration inflow's impact on co‐ethnic natives in the U.S," Southern Economic Journal, John Wiley & Sons, vol. 87(1), pages 191-215, July.
    11. Stuhler, Jan & Jaeger, David & Ruist, Joakim, 2018. "Shift-Share Instruments and the Impact of Immigration," CEPR Discussion Papers 12701, C.E.P.R. Discussion Papers.
    12. Colas, Mark & Sachs, Dominik, 2022. "The Indirect Fiscal Benefits of Low-Skilled Immigration," Rationality and Competition Discussion Paper Series 352, CRC TRR 190 Rationality and Competition.
    13. Masatoshi Jinno & Masaya Yasuoka, 2022. "Immigration policy in a two sector model," Discussion Paper Series 241, School of Economics, Kwansei Gakuin University.

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    More about this item

    Keywords

    Labor Supply Shock; Wages; Immigration; Natural Experiment.;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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