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Immigration, Wages, and Education: a Labor Market Equilibrium Structural Model

  • Joan Llull

    (Universitat Autonoma de Barcelona, MOVE, and Barcelona GSE)

This paper analyzes the effect of immigration on wages taking into account human capital adjustments by natives and previous immigrants. To this end, I propose and estimate a labor market equilibrium structural model. On the labor supply side, individuals make endogenous decisions on education, participation, and occupation. On the demand side, an aggregate firm uses a technology that combines labor skill units with capital to produce a single output, and accounts for skill-biased technical change. I estimate the model using U.S. micro-data for 1967-2007. Results suggest that immigration reduced wages considerably even though natives adjusted their human capital and labor supply behavior to compensate for the change in skill prices.

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Paper provided by Society for Economic Dynamics in its series 2012 Meeting Papers with number 366.

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Date of creation: 2012
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Handle: RePEc:red:sed012:366
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Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA

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  23. repec:oup:restud:v:65:y:1998:i:1:p:45-85 is not listed on IDEAS
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