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Dynamic Effects of Co-Ethnic Networks on Immigrants' Economic Success

Listed author(s):
  • Michele Battisti
  • Giovanni Peri
  • Agnese Romiti

This paper investigates how the size of co-ethnic networks at arrival affected the economic success of immigrants in Germany. Applying panel analysis with a large set of fixed effects and controls, we isolate the association between initial network size and long-run immigrant outcomes. Focusing on refugees – assigned to an initial location independently of their choice – allows a causal interpretation of the estimated coefficient. We find that immigrants initially located in places with larger co-ethnic networks are more likely to be employed at first, but have a lower probability of investing in human capital. In the long run they are more likely to be mis-matched in their job and to earn a lower wage.

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File URL: http://www.nber.org/papers/w22389.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 22389.

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Date of creation: Jul 2016
Handle: RePEc:nbr:nberwo:22389
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  11. Bennett, Patrick & La Cour, Lisbeth & Larsen, Birthe & Waisman, Gisela, 2015. "Negative Attitudes, Network and Education," Working Papers 01-2015, Copenhagen Business School, Department of Economics.
  12. Eric D. Gould & Victor Lavy & M. Daniele Paserman, 2009. "Does Immigration Affect the Long-Term Educational Outcomes of Natives? Quasi-Experimental Evidence," Economic Journal, Royal Economic Society, vol. 119(540), pages 1243-1269, October.
  13. Anna Piil Damm, 2009. "Ethnic Enclaves and Immigrant Labor Market Outcomes: Quasi-Experimental Evidence," Journal of Labor Economics, University of Chicago Press, vol. 27(2), pages 281-314, 04.
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  15. Borjas, George J., 1998. "To Ghetto or Not to Ghetto: Ethnicity and Residential Segregation," Journal of Urban Economics, Elsevier, vol. 44(2), pages 228-253, September.
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  17. Lori A. Beaman, 2012. "Social Networks and the Dynamics of Labour Market Outcomes: Evidence from Refugees Resettled in the U.S," Review of Economic Studies, Oxford University Press, vol. 79(1), pages 128-161.
  18. Montgomery, James D, 1991. "Social Networks and Labor-Market Outcomes: Toward an Economic Analysis," American Economic Review, American Economic Association, vol. 81(5), pages 1407-1418, December.
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  21. Michele Pellizzari, 2010. "Do Friends and Relatives Really Help in Getting a Good Job?," ILR Review, Cornell University, ILR School, vol. 63(3), pages 494-510, April.
  22. Olof Åslund & Per-Anders Edin & Peter Fredriksson & Hans Grönqvist, 2011. "Peers, Neighborhoods, and Immigrant Student Achievement: Evidence from a Placement Policy," American Economic Journal: Applied Economics, American Economic Association, vol. 3(2), pages 67-95, April.
  23. David M. Cutler & Edward L. Glaeser, 1997. "Are Ghettos Good or Bad?," The Quarterly Journal of Economics, Oxford University Press, vol. 112(3), pages 827-872.
  24. Deepti Goel & Kevin Lang, 2009. "Social Ties and the Job Search of Recent Immigrants," NBER Working Papers 15186, National Bureau of Economic Research, Inc.
  25. Yu Xie & Margaret Gough, 2011. "Ethnic Enclaves and the Earnings of Immigrants," Demography, Springer;Population Association of America (PAA), vol. 48(4), pages 1293-1315, November.
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