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Immigration and Structural Change: Evidence from Post-War Germany

  • Braun, Sebastian
  • Kvasnicka, Michael

Does immigration accelerate sectoral change towards high-productivity sectors? This paper uses the mass displacement of ethnic Germans from Eastern Europe to West Germany after World War II as a natural experiment to study this question. A simple two-sector specific factors model, in which moving costs prevent the marginal product of labor to be equalized across sectors, predicts that immigration boosts output per worker by expanding the high-productivity sector, but decreases output per worker within a sector. Using German district-level data from before and after the war, we find empirical support for these predictions.

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Paper provided by Verein für Socialpolitik / German Economic Association in its series Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order with number 79864.

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Date of creation: 2013
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Handle: RePEc:zbw:vfsc13:79864
Contact details of provider: Web page: http://www.socialpolitik.org/
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  1. Barry Eichengreen & Albrecht Ritschl, 2008. "Understanding West German Economic Growth in the 1950s," SFB 649 Discussion Papers SFB649DP2008-068, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
  2. George J. Borjas, 2001. "Does Immigration Grease the Wheels of the Labor Market?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 32(1), pages 69-134.
  3. Rachel M. Friedberg & Jennifer Hunt, 1995. "The Impact of Immigrants on Host Country Wages, Employment and Growth," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 23-44, Spring.
  4. Thomas Bauer & Sebastian Braun & Michael Kvasnicka, 2012. "The Economic Integration of Forced Migrants: Evidence for Post-War Germany," CReAM Discussion Paper Series 1230, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  5. Sari Pekkala Kerr & William R. Kerr, 2011. "Economic Impacts of Immigration: A Survey," NBER Working Papers 16736, National Bureau of Economic Research, Inc.
  6. Tam�s Vony�, 2012. "The bombing of Germany: the economic geography of war-induced dislocation in West German industry," European Review of Economic History, Oxford University Press, vol. 16(1), pages 97-118, February.
  7. Braun, Sebastian & Omar Mahmoud, Toman, 2014. "The Employment Effects of Immigration: Evidence from the Mass Arrival of German Expellees in Postwar Germany," The Journal of Economic History, Cambridge University Press, vol. 74(01), pages 69-108, March.
  8. Falck, Oliver & Heblich, Stephan & Link, Susanne, 2011. "The Evils of Forced Migration: Do Integration Policies Alleviate Migrants' Economic Situations?," IZA Discussion Papers 5829, Institute for the Study of Labor (IZA).
  9. Broadberry, S. N., 1997. "Anglo-German productivity differences 1870 1990: A sectoral analysis," European Review of Economic History, Cambridge University Press, vol. 1(02), pages 247-267, August.
  10. Simonetta Longhi & Peter Nijkamp & Jacques Poot, 2010. "Meta-analyses of labour-market impacts of immigration: key conclusions and policy implications," Environment and Planning C: Government and Policy, Pion Ltd, London, vol. 28(5), pages 819-833, October.
  11. Schündeln, Matthias, 2007. "Are Immigrants More Mobile Than Natives? Evidence from Germany," IZA Discussion Papers 3226, Institute for the Study of Labor (IZA).
  12. Mussa, Michael, 1974. "Tariffs and the Distribution of Income: The Importance of Factor Specificity, Substitutability, and Intensity in the Short and Long Run," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1191-1203, Nov.-Dec..
  13. Temin, Peter, 2002. "The Golden Age of European growth reconsidered," European Review of Economic History, Cambridge University Press, vol. 6(01), pages 3-22, April.
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