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The wage impact of immigration in Germany: New evidence for skill groups and occupations

  • Steinhardt, Max Friedrich

The paper contributes to the ongoing debate about the adequate technique to identify the impact of immigration. Initially the regression analysis on the basis of education-experience cells reveals that the impact of immigration on native wages in Germany is negative, but small. The subsequent analysis on the basis of occupations using the same data yields a considerably higher adjustment coefficient and indicates strong wage effects within primary service occupations with a magnitude comparable to results for the US. The analysis therefore demonstrates that the use of formal qualifications as an exclusive classification criterion may lead to an underestimation of the impact of immigration.

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Paper provided by Hamburg Institute of International Economics (HWWI) in its series HWWI Research Papers with number 1-23.

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Date of creation: 2009
Date of revision:
Handle: RePEc:zbw:hwwirp:1-23
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  1. Orrenius, Pia M. & Zavodny, Madeline, 2007. "Does immigration affect wages? A look at occupation-level evidence," Labour Economics, Elsevier, vol. 14(5), pages 757-773, October.
  2. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
  3. Gianmarco I.P. Ottaviano & Giovanni Peri, 2006. "Rethinking the Gains from Immigration: Theory and Evidence from the U.S," Working Papers 2006.52, Fondazione Eni Enrico Mattei.
  4. George J. Borjas, 2008. "Labor Outflows and Labor Inflows in Puerto Rico," Journal of Human Capital, University of Chicago Press, vol. 2(1), pages 32-68.
  5. Giovanni Peri & Chad Sparber, 2009. "Task Specialization, Immigration and Wages," Working Papers 91, University of California, Davis, Department of Economics.
  6. Bonin, Holger, 2005. "Wage and Employment Effects of Immigration to Germany: Evidence from a Skill Group Approach," IZA Discussion Papers 1875, Institute for the Study of Labor (IZA).
  7. John M. Abowd & Richard B. Freeman, 1991. "Immigration, Trade, and the Labor Market," NBER Books, National Bureau of Economic Research, Inc, number abow91-1, December.
  8. Krishna Patel & Francis Vella, 2013. "Immigrant Networks and Their Implications for Occupational Choice and Wages," The Review of Economics and Statistics, MIT Press, vol. 95(4), pages 1249-1277, October.
  9. Joseph Altonji & David Card, 1989. "The Effects of Immigration on the Labor Market Outcome of Less-Skilled Natives," Working Papers 636, Princeton University, Department of Economics, Industrial Relations Section..
  10. George J. Borjas & Richard B. Freeman & Lawrence F. Katz, 1991. "On the Labor Market Effects of Immigration and Trade," NBER Working Papers 3761, National Bureau of Economic Research, Inc.
  11. Mitchell A. Petersen, 2005. "Estimating Standard Errors in Finance Panel Data Sets: Comparing Approaches," NBER Working Papers 11280, National Bureau of Economic Research, Inc.
  12. Steinhardt, Max Friedrich, 2008. "Does citizenship matter? The economic impact of naturalizations in Germany," HWWI Research Papers 3-13, Hamburg Institute of International Economics (HWWI).
  13. Card, David, 2001. "Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 22-64, January.
  14. George J. Borjas, 2009. "The Analytics of the Wage Effect of Immigration," NBER Working Papers 14796, National Bureau of Economic Research, Inc.
  15. Zimmermann, Klaus F, 1993. "Native Wage Impacts of Foreign Labour: A Random Effects Panel Analysis," CEPR Discussion Papers 851, C.E.P.R. Discussion Papers.
  16. Fitzenberger, Bernd & Schnabel, Reinhold & Wunderlich, Gaby, 2001. "The gender gap in labor market participation and employment: a cohort analysis for West Germany," ZEW Discussion Papers 01-47, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  17. Abdurrahman Aydemir & George J. Borjas, 2007. "Cross-Country Variation in the Impact of International Migration: Canada, Mexico, and the United States," Journal of the European Economic Association, MIT Press, vol. 5(4), pages 663-708, 06.
  18. Grossman, Jean Baldwin, 1982. "The Substitutability of Natives and Immigrants in Production," The Review of Economics and Statistics, MIT Press, vol. 64(4), pages 596-603, November.
  19. Greenwood, Michael J & McDowell, John M, 1986. "The Factor Market Consequences of U.S. Immigration," Journal of Economic Literature, American Economic Association, vol. 24(4), pages 1738-72, December.
  20. Gartner, Hermann, 2005. "The imputation of wages above the contribution limit with the German IAB employment sample," FDZ Methodenreport 200502_en, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  21. Constant, Amelie F. & Massey, Douglas S., 2003. "Labor Market Segmentation and the Earnings of German Guestworkers," IZA Discussion Papers 774, Institute for the Study of Labor (IZA).
  22. Christian Dustmann & Francesca Fabbri & Ian Preston, 2005. "The Impact of Immigration on the British Labour Market," Economic Journal, Royal Economic Society, vol. 115(507), pages F324-F341, November.
  23. Liesbet Okkerse, 2008. "How To Measure Labour Market Effects Of Immigration: A Review," Journal of Economic Surveys, Wiley Blackwell, vol. 22(1), pages 1-30, 02.
  24. Jörn-Steffen Pischke & Johannes Velling, 1997. "Employment Effects Of Immigration To Germany: An Analysis Based On Local Labor Markets," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 594-604, November.
  25. Brücker, Herbert & Jahn, Elke J., 2008. "Migration and the Wage Curve: A Structural Approach to Measure the Wage and Employment Effects of Migration," IZA Discussion Papers 3423, Institute for the Study of Labor (IZA).
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