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The Labor Market Effects of Immigration and Emigration in OECD Countries

Author

Listed:
  • Docquier, Frédéric

    () (Université catholique de Louvain)

  • Ozden, Caglar

    () (World Bank)

  • Peri, Giovanni

    () (University of California, Davis)

Abstract

In this paper, we simulate the labor market effects of net immigration and emigration during the 1990's in all OECD countries. To accomplish this, we are the first to employ a comprehensive database of migrant stocks, grouped by education level and country of origin/destination, for the years 1990 and 2000. Due to the much higher international mobility of college graduates, relative to all other individuals, we find that net migration flows are college-intensive, relative to the population of non-migrants. Using the consensus aggregate model of labor demand and supply we simulate the long-run employment and wage effects of immigration and emigration. We use a range of parameter values spanning most of the estimates in the literature. In all cases we find that immigration had a positive effect on the wage of less educated natives. It also increased or left the average native wages unchanged and had a positive or no effect on native employment. To the contrary, emigration had a negative effect on the wage of less educated native workers and it contributed to increase within country inequality in all OECD countries. These results still hold true when we correct for the estimates of undocumented immigrants, for the skill-downgrading of immigrants, when we focus on immigration from non-OECD countries, and when we consider preliminary measures of more recent immigration flows for the period 2000-2007.

Suggested Citation

  • Docquier, Frédéric & Ozden, Caglar & Peri, Giovanni, 2011. "The Labor Market Effects of Immigration and Emigration in OECD Countries," IZA Discussion Papers 6258, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp6258
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    References listed on IDEAS

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    1. Antonio Ciccone & Giovanni Peri, 2006. "Identifying Human-Capital Externalities: Theory with Applications," Review of Economic Studies, Oxford University Press, vol. 73(2), pages 381-412.
    2. Sari Pekkala Kerr & William R. Kerr, 2011. "Economic Impacts of Immigration: A Survey," Finnish Economic Papers, Finnish Economic Association, vol. 24(1), pages 1-32, Spring.
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    1. Efficiency vs sanctity
      by chris dillow in Stumbling and Mumbling on 2012-10-07 17:06:06

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    Cited by:

    1. Xiangbo Liu & Theodore Palivos & Xiaomeng Zhang, 2017. "Immigration, Skill Heterogeneity, And Qualification Mismatch," Economic Inquiry, Western Economic Association International, vol. 55(3), pages 1231-1264, July.
    2. Mette Foged & Giovanni Peri, 2016. "Immigrants' Effect on Native Workers: New Analysis on Longitudinal Data," American Economic Journal: Applied Economics, American Economic Association, vol. 8(2), pages 1-34, April.
    3. David de la Croix & Frederic Docquier, 2015. "An Incentive Mechanism to Break the Low-skill Immigration Deadlock," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 18(3), pages 593-618, July.
    4. Beine, M. & Bricongne,J-C. & Bourgeon, P., 2013. "Aggregate Fluctuations and International Migration," Working papers 453, Banque de France.
    5. Santos-Arteaga, Francisco J. & Di Caprio, Debora & Tavana, Madjid & O’Connor, Aidan, 2017. "Innovation dynamics and labor force restructuring with asymmetrically developed national innovation systems," International Business Review, Elsevier, vol. 26(1), pages 36-56.
    6. Giovanni Peri, 2016. "Immigrants, Productivity, and Labor Markets," Journal of Economic Perspectives, American Economic Association, vol. 30(4), pages 3-30, Fall.
    7. Cho, Cheol-Joo, 2017. "The displacement and attraction effects in interurban migration: An application of the input-output scheme to the case of large cities in Korea," Economics Discussion Papers 2017-49, Kiel Institute for the World Economy (IfW).
    8. Aubry, Amandine & Burzyński, Michał & Docquier, Frédéric, 2016. "The welfare impact of global migration in OECD countries," Journal of International Economics, Elsevier, pages 1-21.
    9. Protte, Benjamin, 2012. "How does Economic Integration Change Personal Income Taxation? Evidence from a new Index of Potential Labor Mobility," Working Papers 12-20, University of Mannheim, Department of Economics.
    10. repec:spr:jopoec:v:31:y:2018:i:1:d:10.1007_s00148-017-0645-0 is not listed on IDEAS
    11. repec:spr:portec:v:16:y:2017:i:2:d:10.1007_s10258-017-0130-4 is not listed on IDEAS
    12. repec:leo:wpaper:2314 is not listed on IDEAS
    13. Rémi Bazillier & Francesco Magris & Daniel Mirza, 2017. "Out-migration and economic cycles," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 153(1), pages 39-69, February.
    14. Michel Beine & Serge Coulombe, 2018. "Immigration and internal mobility in Canada," Journal of Population Economics, Springer;European Society for Population Economics, pages 69-106.
    15. Lewis, Ethan & Peri, Giovanni, 2015. "Immigration and the Economy of Cities and Regions," Handbook of Regional and Urban Economics, Elsevier.
    16. repec:ilo:ilowps:485561 is not listed on IDEAS
    17. repec:eee:eecrev:v:96:y:2017:i:c:p:62-82 is not listed on IDEAS
    18. Ismael Issifou & Francesco Magris, 2017. "Migration outflows and optimal migration policy: rules versus discretion," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 16(2), pages 87-112, August.
    19. Malakhov, Vladimir & Simon, Mark, 2017. "Migration Policy in the Conditions of Economic Turbulence: The Experience of the European Union and the Prospects of Russia," Working Papers 051723, Russian Presidential Academy of National Economy and Public Administration.
    20. Wickramasekara, Piyasiri., 2014. "Assessment of the impact of migration of health professionals on the labour market and health sector performance in destination countries," ILO Working Papers 994855613402676, International Labour Organization.
    21. Mitaritonna, Cristina & Orefice, Gianluca & Peri, Giovanni, 2017. "Immigrants and firms’ outcomes: Evidence from France," European Economic Review, Elsevier, vol. 96(C), pages 62-82.

    More about this item

    Keywords

    immigration and emigration; complementarity; schooling externalities; wage inequality; average wage;

    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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