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The Wage Effects of Immigration and Emigration

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  • Frederic DOCQUIER

    () (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) and FNRS)

  • Çaglar OZDEN

    () (The World Bank, Development Research Group)

  • Giovanni PERI

    () (University of California, Davis)

Abstract

In this paper, we simulate the long-run effects of migrant flows on wages of high-skilled and low-skilled non-migrants in a set of countries using an aggregate representation of national economies. We focus on Europe and compare the outcomes for large Western European countries with those of other key destination countries both in the OECD and outside the OECD. Our analysis builds on an improved database of bilateral stocks and net migration flows of immigrants and emigrants by education level for the years 1990 through 2000. We find that all European countries experienced a decrease in their average wages and a worsening of their wage inequality because of emigration. Whereas, immigration had nearly equal but opposite effects. These patterns hold true using a range of parameters for our simulations, accounting for the estimates of undocumented immigrants, and correcting for the quality of schooling and/or labor-market downgrading of skills. In terms of economic outcomes, it follows that prevalent public fears in European countries are misplaced; immigration has had a positive average wage effect on native workers. These concerns would be more properly focused on the wage effect of emigration.

Suggested Citation

  • Frederic DOCQUIER & Çaglar OZDEN & Giovanni PERI, 2010. "The Wage Effects of Immigration and Emigration," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2010044, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  • Handle: RePEc:ctl:louvir:2010044
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    References listed on IDEAS

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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. The Wage Effects of Immigration and Emigration
      by Ariel Goldring in Free Market Mojo on 2011-03-04 18:17:07

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    Cited by:

    1. Moritz Bonn, 2011. "High Skilled Immigration Policy and Union Wage Setting," Volkswirtschaftliche Diskussionsbeiträge 147-11, Universität Siegen, Fakultät Wirtschaftswissenschaften, Wirtschaftsinformatik und Wirtschaftsrecht, revised 27 Aug 2012.
    2. Bertoli, Simone & Fernández-Huertas Moraga, Jesús, 2013. "Multilateral resistance to migration," Journal of Development Economics, Elsevier, vol. 102(C), pages 79-100.
    3. Elsner, Benjamin, 2013. "Emigration and wages: The EU enlargement experiment," Journal of International Economics, Elsevier, vol. 91(1), pages 154-163.
    4. Armando J. Garcia Pires, 2015. "Brain Drain And Brain Waste," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 40(1), pages 1-34, March.
    5. Francesc Ortega & Giovanni Peri, 2012. "The Effect of Trade and Migration on Income," NBER Working Papers 18193, National Bureau of Economic Research, Inc.
    6. E. Podrecca & G. Rossini, 2012. "Wages and international factors’ mobility," Working Papers wp826, Dipartimento Scienze Economiche, Universita' di Bologna.
    7. Dequiedt, Vianney & Zenou, Yves, 2013. "International migration, imperfect information, and brain drain," Journal of Development Economics, Elsevier, vol. 102(C), pages 62-78.
    8. repec:wsi:wschap:9789814719902_0010 is not listed on IDEAS
    9. repec:bla:worlde:v:40:y:2017:i:6:p:1068-1088 is not listed on IDEAS
    10. Dramane Coulibaly & Blaise Gnimassoun & Valérie Mignon, 2016. "Growth-enhancing effect of openness to trade and migrations: What is the effective transmission channel for Africa?," Working Papers of BETA 2016-50, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    11. repec:ces:ifodic:v:9:y:2012:i:4:p:17567553 is not listed on IDEAS
    12. Rosa Sanchis-Guarner, 2014. "First-Come First-Served: Identifying the Demand Effect of Immigration Inflows on House Prices," SERC Discussion Papers 0160, Spatial Economics Research Centre, LSE.
    13. Andri Chassamboulli & Theodore Palivos, 2014. "A Search‐Equilibrium Approach To The Effects Of Immigration On Labor Market Outcomes," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 55, pages 111-129, February.
    14. Vincent Fromentin & Olivier Damette & Benteng Zou, 2017. "The Global Economic Crisis and The Effect of Immigrant Workers on Native-born Employment in Europe," The World Economy, Wiley Blackwell, vol. 40(6), pages 1068-1088, June.
    15. Harry P. Bowen & Jennifer Pédussel Wu, 2013. "Immigrant Specificity and the Relationship between Trade and Immigration: Theory and Evidence," Southern Economic Journal, Southern Economic Association, vol. 80(2), pages 366-384, October.
    16. Peri, Giovanni & D'Amuri, Francesco, 2010. "Immigration, Jobs and Employment Protection: Evidence from Europe," Institute of European Studies, Working Paper Series qt9rp2j8m1, Institute of European Studies, UC Berkeley.
    17. Francesc Ortega & Giovanni Peri, 2016. "Openness and income: The roles of trade and migration," World Scientific Book Chapters,in: The Economics of International Migration, chapter 10, pages 309-329 World Scientific Publishing Co. Pte. Ltd..
    18. Moritz Bonn, 2011. "The Effects of High Skilled Immigration in a Dual Labour Market with Union Wage Setting and Fiscal Redistribution," MAGKS Papers on Economics 201121, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    19. Giovanni Peri, 2011. "The Impact of Immigration on Native Poverty through Labor Market Competition," NBER Working Papers 17570, National Bureau of Economic Research, Inc.
    20. Michael A. Clemens, 2011. "Economics and Emigration: Trillion-Dollar Bills on the Sidewalk?," Journal of Economic Perspectives, American Economic Association, vol. 25(3), pages 83-106, Summer.
    21. Giovanni Peri, 2012. "Immigration and Europe’s Demographic Problems: Analysis and Policy Considerations," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 9(4), pages 03-08, 02.
    22. Giorgio Liotti & Salvatore Villani, 2014. "The equalising power of internal immigration and the desertification process of southern Italy," STUDI ECONOMICI, FrancoAngeli Editore, vol. 2014(114), pages 51-77.
    23. Alessandra Venturini, 2012. "Methodological Aspects of Research on Flows Human Capital Flows: A survey," RSCAS Working Papers carim2012/01, European University Institute.

    More about this item

    Keywords

    Immigration; Emigration; Complementarity; Schooling Externalities; Average Wage; Wage inequality;

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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