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The effects of immigration on the productive structure of Spanish regions

Listed author(s):
  • Francisco Requena

    (Universitat de València)

  • Guadalupe Serrano

    (Universitat de València)

  • Joan Martín Montaner

    (Universitat Jaume I)

Immigrants have increased their participation in Spanish labour supply from less than 3 percent in 1996 to more than 13 percent in 2005. Using the factor proportion model of production, this paper analyses whether this labour supply shock has affected the industrial structure of Spanish regions. Our best specification suggests the need to include time varying region-specific effects to capture differences in technology and prices across regions. Our results confirm that, first, labour endowment differences across regions help to explain the pattern of industry specialisation across region. Second, immigrants and natives act as complementary factors in most industries. Third, the importance of factor endowment changes is relatively small compared to production technique changes and idiosyncratic industry changes in explaining the overall changes in industrial structure over 1996-2005, being only important in the case of Building, a sector where foreign workers represent an important share of its total labour force.

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File Function: Fisrt version / Primera version, 2009
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Paper provided by Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) in its series Working Papers. Serie EC with number 2009-01.

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Length: 24 pages
Date of creation: Jan 2009
Publication status: Published by Ivie
Handle: RePEc:ivi:wpasec:2009-01
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