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Effects of Immigration on Intra-Industry Trade: A logit analysis

  • Horácio Faustino
  • Isabel Proença

This study estimates the effects of the immigration stock, as well as those of immigrants’ characteristics, such as having the same language as that of the host country and the level of qualification or entrepreneurship, on Portuguese intra-industry trade (IIT) by types, controlling for the effects of other socio-economic factors, like economic dimensions, price indexes and distance. In addition to the member-countries of the EU-27, the group of countries studied includes five African countries with Portuguese as their official language, known as the PALOPs, and the BRIC countries. Since indexes are fractional variables, the pseudo-likelihood Logit estimator was used on the panel data to obtain the empirical results. The study found that an increase of the immigrant stock will produce an increment in the trade indexes considered and this effect is enhanced if immigrants originate from a country where Portuguese is the official language, or if they are highly qualified, whereas immigrant entrepreneurs have no significant effect.

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File URL: http://pascal.iseg.utl.pt/~depeco/wp/wp192011.pdf
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Paper provided by ISEG - School of Economics and Management, Department of Economics, University of Lisbon in its series Working Papers Department of Economics with number 2011/19.

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Date of creation: Sep 2011
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Handle: RePEc:ise:isegwp:wp192011
Contact details of provider: Postal: Department of Economics, ISEG - School of Economics and Management, University of Lisbon, Rua do Quelhas 6, 1200-781 LISBON, PORTUGAL
Web page: https://aquila1.iseg.ulisboa.pt/aquila/departamentos/EC

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