nep-mig New Economics Papers
on Economics of Human Migration
Issue of 2007‒05‒12
twenty-two papers chosen by
Yuji Tamura
Trinity College Dublin

  1. Illegal Migration, Enforcement and Minimum Wage By Gil S. Epstein; Odelia Heizler (Cohen)
  2. International migration: A panel data analysis of the determinants of bilateral flows By Anna Maria Mayda
  3. Europe, Space of Freedom and Security. Migration and mobility: Assets and challenges for the enlargement of the European Union By Silasi, Grigore; Simina, Ovidiu Laurian
  4. Regional macroeconomic determinants of Mexican migration By Mendoza, Jorge Eduardo
  5. A Comparative Analysis of the Nativity Wealth Gap By Thomas K. Bauer; Deborah A. Cobb-Clark; Vincent Hildebrand; Mathias Sinning
  6. The Impact of Immigration on the Geographic Mobility of New Zealanders By Steven Stillman; David C. Maré
  7. Policies for Migration and Development: A European Perspective By Louka T. Katseli; Robert E.B. Lucas; Theodora Xenogiani
  8. The global implications of freer skilled migration By Rod Tyers; Iain Bain; Jahnvi Vedi
  9. Labor Reallocation over the Business Cycle: New Evidence from Internal Migration By Raven E. Saks; Abigail Wozniak
  10. The impact of the recent migration from Eastern Europe on the UK economy By David Blanchflower; Jumana Saleheen; Chris Shadforth
  11. Why is the Payoff to Schooling Smaller for Immigrants? By Paul W. Miller; Barry R. Chiswick
  12. The Immigrant-Native Born Earnings Gap in the US: a Quantile Regression Analysis and International Comparison By Anh Tram Le; Paul W. Miller; Barry R. Chiswick
  13. The Income Gap Between Natives and Second Generation Immigrants in Sweden: Is Skill the Explanation? By Martin Nordin; Dan-Olof Rooth
  14. When Are Ghettos Bad? Lessons from Immigrant Segregation in the United States By David M. Cutler; Edward L. Glaeser; Jacob L. Vigdor
  15. Defining housing market areas using commuting and migration algorithms.Catalonia (Spain) as an applied case study. By Vicente Royuela; Miguel Vargas
  16. Issues and Prospects on the Movement of Natural Persons and Human Capital Development in the Philippine-American Economic Relations By Tullao, Tereso Jr. S.; Cortez, Michael Angelo A.
  17. Immigration and Trade: How Important is the link? Evidence from Australia By M.A.B. Siddique
  18. National Origin Wage Differentials in France: Evidence from Matched Employer-Employee Data By Romain Aeberhardt; Julien Pouget
  19. Wage and Labor Mobility in Denmark, 1980-2000 By Tor Eriksson; Niels Westergaard-Nielsen
  20. Party Formation and Racism By Anesi, Vincent; De Donder, Philippe
  21. The Power of the Family By Alberto Alesina; Paola Giuliano
  22. Politiques migratoires et développement : Une perspective européenne By Louka T. Katseli; Robert E.B. Lucas; Theodora Xenogiani

  1. By: Gil S. Epstein (Bar-Ilan University, CReAM, London and IZA, Bonn); Odelia Heizler (Cohen) (Bar-Ilan University)
    Abstract: This paper examines the connection between illegal migration, minimum wages and enforcement policy. We first explore the employers’ decision regarding the employment of illegal migrants in the presence of an effective minimum wage. We show that the employers’ decision depends on the wage gap between those of the legal and illegal workers and on the penalty for employing illegal workers. We consider the effects a change in the minimum wage has on the employment of illegal immigrants and local workers. We conclude by considering the optimal migration policy taking into consideration social welfare issues.
    Keywords: illegal immigration, migration policy, minimum wage, interest groups.
    Date: 2007–05
  2. By: Anna Maria Mayda (Department of Economics and School of Foreign Service, Georgetown University.)
    Abstract: In this paper I empirically investigate the determinants of migration inflows into fourteen OECD countries by country of origin, between 1980 and 1995. I analyze the effect on migration of average income and income dispersion in destination and origin countries. I also examine the impact of geographical, cultural, and demographic factors as well as the role played by changes in destination countries’ migration policies. My analysis both delivers estimates consistent with the predictions of the international migration model and generates empirical puzzles.
    Keywords: International Migration, Determinants, Push and Pull Factors, Migration Policy
    JEL: F22 F1
    Date: 2007–05
  3. By: Silasi, Grigore; Simina, Ovidiu Laurian
    Abstract: The ‘Jean Monnet’ European Centre of Excellence (C03/0110) and the School of High Comparative European Studies (SISEC), both from the West University of Timisoara, propose to launch the scientific debate on the migration and mobility within the Romanian universities, the academic life and among the policies and decision makers from Romania. The International Colloquium Migration and Mobility: Assets and Challenges for the Enlargement of the European Union proposed for 4-5 of May 2006 is part of the SISEC bi-annual project "EUROPE: SPACE OF FREEDOM AND SECURITY", dedicated to study of European Affairs, with focus on migration and mobility, in the framework of the European Year of Workers’ Mobility 2006. The participants were both renowned experts on migration and mobility, and PhD students interested in the challenging subjects proposed.
    Keywords: migration EU acquis illegal migration irregula immigrants labour migration right to work EU enlargement cost and benefit analysis remittances development development networks circular migration Diasporas
    JEL: O15 J61 F22
    Date: 2006–05–04
  4. By: Mendoza, Jorge Eduardo
    Abstract: This article estimates the macroeconomic determinants of Mexican migration to the U.S.A., using information on the regional economic characteristics of the Mexican states, in a context of economic integration with the U.S. economy. A cross sectional database at the regional level is used to estimate a weighted least squares regression. The results show that the ratio of the U.S.A.’s PIB to Mexico’s states PIB showed a positive effect on migration,suggesting regional economic determinants for migration. In this case, the PIB per cápita had a negative effect, which implies that the poorest states experienced incentives for migration. Additionally, state unemployment rates and permanent migrant stocks exhibited a positive effect on the rates of migration growth at the state level in Mexico, supporting the approaches that consider those variables as factors for migration. The variables reflecting the impact of economic liberalization were not conclusive, although foreign direct investment exhibited a positive coefficient with respect to migration growth.
    Keywords: 1. international migration; 2. macroeconomics; 3. regional economics; 4. labor mobility; 5. employment.
    JEL: J61 F22 J01
    Date: 2006
  5. By: Thomas K. Bauer (RWI Essen, Ruhr-University Bochum and IZA); Deborah A. Cobb-Clark (Australian National University and IZA); Vincent Hildebrand (Glendon College, York University and CEPS/INSTEAD); Mathias Sinning (RWI Essen and IZA)
    Abstract: This paper investigates the source of the gap in the relative wealth position of immigrant households residing in Australia, Germany and the United States. Our results indicate that in Germany and the United States wealth differentials are largely the result of disparity in the educational attainment and demographic composition of the native and immigrant populations, while income differentials are relatively unimportant in understanding the nativity wealth gap. In contrast, the relatively small wealth gap between Australian- and foreign-born households exists because immigrants to Australia do not translate their relative educational and demographic advantage into a wealth advantage. On balance, our results point to substantial cross-national disparity in the economic well-being of immigrant and native families, which is largely consistent with domestic labor markets and the selection policies used to shape the nature of the immigration flow.
    Keywords: international migration, wealth accumulation
    JEL: F22 D31
    Date: 2007–05
  6. By: Steven Stillman (Motu Economic and Public Policy Research); David C. Maré (Motu Economic and Public Policy Research)
    Abstract: This paper uses data from the New Zealand Census to examine how the supply of recent migrants in particular skill groups affects the geographic mobility of the New Zealand-born and earlier migrants. We identify the impact of recent migration on mobility using the 'areaanalysis' approach, which exploits the fact that immigration is spatially concentrated, and thus a change in the local supply of migrants in a particular skill group should have an impact on the mobility of similarly skilled non-migrants in that local labour market. Overall, our results provide little support for the hypothesis that migrant inflows displace either the NZ-born or earlier migrants with similar skills in the areas that new migrants are settling. If anything, they suggest that there are positive spillovers between recent migrants and other individuals that encourage individuals to move to or remain in the areas in which similarly skilled migrants are settling. Thus, it appears unlikely that internal mobility moderates any potential impacts of immigration on labour or housing markets in New Zealand.
    Keywords: Immigration; Mobility; New Zealand; Labour Market Areas
    JEL: J61 R
    Date: 2007–04
  7. By: Louka T. Katseli; Robert E.B. Lucas; Theodora Xenogiani
    Abstract: Managing migration has become a priority for policy makers both in developed and developing countries; it is a difficult challenge indeed. Large immigration or emigration flows relative to domestic population’s impact on almost all aspects of an economy and society: family structures, community life, educational and health systems, labour markets, security systems, governance and institutions. Despite the inherent difficulties in policy making, there is a growing awareness that if management can be improved, important gains for both migrant-receiving (“host”) and migrant-sending (“home”) countries may be generated. Effective management can furthermore mitigate the risks associated with migration....
    Date: 2006–10
  8. By: Rod Tyers (School of Economics, College of Business and Economics, Australian National University); Iain Bain; Jahnvi Vedi
    Abstract: One consequence of the trade and technology driven increases in skill premia in the older industrial regions since the 1980s has been a perceived “skill shortage” in those regions, along with freer migration of skilled and professional workers from developing regions. While skilled migration flows remain too small to have large short-run effects on labour markets, a further opening to skilled migrants by the industrialised North could see substantial changes in labour markets and overall growth performance. The links between demographic change, migration flows and growth performance are here explored using a new demographic sub-model that is integrated with an adaptation of the GTAP-Dynamic global economic model in which regional households are disaggregated by age and gender. Skilled migration flows are assumed to be motivated by real wage differences to an extent that is variably constrained by immigration policies. A uniform relaxation of these constraints has most effect on labour markets in the traditional migrant destinations, Australia, Western Europe and North America, where it restrains the skill premium and substantially enhances GDP growth. The skill premium is raised, however, in regions of origin, and particularly in South Asia, although the extent of this is shown to depend sensitively on the responsiveness of skill acquisition to regional skill premia.
    Keywords: Demographic change, skilled migration, labour markets, economic growth.
    JEL: C68 E22 E27 F21 F43 J11
    Date: 2006–06
  9. By: Raven E. Saks (Federal Reserve Board of Governors); Abigail Wozniak (University of Notre Dame and IZA)
    Abstract: This paper establishes the cyclical properties of a novel measure of worker reallocation: longdistance migration rates within the US. This internal migration offers a bird’s eye view of worker reallocation in the economy as long-distance migrants often change jobs or employment status, altering the spatial allocation of labor. Using historical reports of the Current Population Survey (CPS), we examine gross migration patterns during the entire postwar era, a period that spans ten recessions over more than fifty years. We obtain additional evidence on inter-state and inter-metropolitan population flows during the past thirty years from statistics compiled by the Internal Revenue Service. We find that internal migration within the US is strongly procyclical in both sources. Even after accounting for variation in relative local economic conditions, migration is lower during downturns in the national economy. Using individual-level CPS data, we find that migration is procyclical for most major demographic and labor force groups, although it is strongest for younger workers. Our findings suggest that cyclical fluctuations in internal migration are driven by economywide changes in the net cost to worker reallocation with a major role for the job finding rate of young workers.
    Keywords: internal migration, worker reallocation, business cycles, procyclical migration
    JEL: J6 E32
    Date: 2007–04
  10. By: David Blanchflower; Jumana Saleheen; Chris Shadforth
    Abstract: The recent rise in migration to the UK from eight EU Accession countries (the Czech Republic; Estonia; Hungary; Latvia; Lithuania; Poland; Slovakia; and Slovenia - the A8 countries) has generated a good deal of controversy. How many A8 immigrants are there in the UK? Where did they come from and when? What impact has their influx had on the UK economy and what likely impacts will they have in the future? Most importantly for the Monetary Policy Committee (MPC), what macroeconomic effects have they had? We attempt to address these questions here. First, we examine the change in population in the UK over the last thirty-five years and note that growth is very low by international standards. The UK population has, however, grown at a faster pace since the turn of the millennium, driven most recently by migration from the A8 nations. It appears that the propensity to migrate to the UK from these countries is higher the lower is GDP per capita. Second, we examine the various sources of data that are available on the numbers of A8 immigrants that have arrived in the UK in recent years. There is broad agreement from the various data sources on the numbers involved - half a million workers is likely to be an upper bound for the stock of A8 migrants who are in the UK in late 2006. Many of the new 'migrants' may have stayed for only a short time and then returned home, to possibly return again at a later date. Third, we examine the characteristics of the recent flow of individuals from the A8 countries that have arrived in the UK since accession, and find that they are relatively young, male, have low unemployment rates, lower wages, and high self-employment rates and are especially likely to be in temporary jobs. Finally, we turn to the macroeconomic implications of A8 migration to the UK, and argue that this immigration has made the labour market more flexible and likely lowered the natural rate of unemployment and the NAIRU.
    Date: 2007
  11. By: Paul W. Miller (Department of Economics, The University of Western Australia); Barry R. Chiswick (Department of Economics, The University of Illinois at Chicago)
    Abstract: This paper is concerned with why immigrants appear to have consistently lower partial effects of schooling on earnings than the native born, both across destinations and in different time periods within countries. It uses the Over-Required-Under education approach to occupations, a new decomposition technique developed especially for this approach, and data from the 2000 Census of the United States. Based on the average (mode or mean) level of schooling in their occupation, the schooling of the native and foreign born adult men is divided into the “required” (average) level, and years of under- or over-education. Immigrants have a wider variance in schooling, with an especially large proportion undereducated given the average schooling level in their occupation. Immigrants are shown to receive approximately the same rate of return to the “required” (occupational norm) level of education, but experience a smaller negative effect of years of undereducation, and to a lesser extent a small positive effect of overeducation. About two-thirds of the smaller effect of schooling on earnings for immigrants is due to their different payoffs to undereducation and overeducation. The remainder is largely due to their different distribution of years of schooling. The country-of-origin differences in the returns to under- and over-education are consistent with country differences in the international transferability of skills to the US and the favorable selectivity of economic migrants, especially those from countries other than the English-speaking developed countries. The decomposition developed is used to quantify the contribution of favorable selection in immigration and the less-than-perfect international transferability of skills. The results suggest that favorable selection is the more important contributor to the smaller payoff to schooling for immigrants.
    Keywords: Immigrants, Schooling, Occupations, Earnings, Rates of Return, Selectivity
    JEL: F22 I21 J24 J31 J61
    Date: 2006
  12. By: Anh Tram Le (Department of Economics, The University of Western Australia); Paul W. Miller (Department of Economics, The University of Western Australia); Barry R. Chiswick (Department of Economics, The University of Illinois at Chicago)
    Keywords: Immigrants, Earnings Distributions, Rates of Return, Quantile Regression
    JEL: J15 J24 J31 F22
    Date: 2006
  13. By: Martin Nordin (Lund University); Dan-Olof Rooth (Kalmar University, CReAM and IZA)
    Abstract: This is the first study to use an achievement test score to analyze whether the income gap between second-generation immigrants and natives is caused by a skill gap rather than ethnic discrimination. Since, in principle, every male Swedish citizen takes the test when turning 18, we are able to bring more evidence to bear on the matter by estimating the income gap for a very large sample of individuals who are of the same age and have the same years of schooling at the test date. Once the result of the Swedish Military Enlistment Test is controlled for, the income gap almost disappears for second generation immigrants with both parents born in Southern Europe or outside Europe. However, when using a regular set of control variables the income gap becomes overestimated. This difference in results is most likely explained by the fact that schooling is a bad measure of productive skills for these groups of second-generation immigrants. It indicates that they compensate for their lower probability of being employed by investing in (in relation to their skill level) more schooling than otherwise similar natives.
    Keywords: productive skills, discrimination, incomes, wages
    JEL: J64 J71
    Date: 2007–04
  14. By: David M. Cutler; Edward L. Glaeser; Jacob L. Vigdor
    Abstract: Recent literature on the relationship between ethnic or racial segregation and outcomes has failed to produce a consensus view of the role of ghettos; some studies suggest that residence in an enclave is beneficial, some reach the opposite conclusion, and still others imply that any relationship is small. This paper presents new evidence on this relationship using data on first-generation immigrants in the United States. Using average group characteristics as instruments for segregation, controlling for individual characteristics and both metropolitan area and country-of-origin fixed effects, we estimate impacts of residential concentration that vary with group human capital levels. Residential concentration can be beneficial, but primarily for more educated groups. The mean impact of residential concentration varies across measures, which may illuminate some of the causal mechanisms relating segregation to outcomes.
    JEL: J15 R2
    Date: 2007–05
  15. By: Vicente Royuela (Faculty of Economics, University of Barcelona); Miguel Vargas (Faculty of Economics and Business, Diego Portales University.)
    Abstract: In the literature on housing market areas, different approaches can be found to defining them, for example, using travel-to-work areas and, more recently, making use of migration data. Here we propose a simple exercise to shed light on which approach performs better. Using regional data from Catalonia, Spain, we have computed housing market areas with both commuting data and migration data. In order to decide which procedure shows superior performance, we have looked at uniformity of prices within areas. The main finding is that commuting algorithms present more homogeneous areas in terms of housing prices.
    Date: 2007–04
  16. By: Tullao, Tereso Jr. S.; Cortez, Michael Angelo A.
    Abstract: The United States of America is the top trading partner of the Philippines and also the top destination of highly skilled and professional Filipino workers. This paper explores the possibility of a free trade agreement (FTA) that covers the asymmetries of the two countries in labor, services and human resources development, particularly educational services. The existing FTAs of the U.S. were examined to seek for provisions the Philippines may adopt for a freer movement of natural persons. However, there are barriers inherent in the U.S. immigration and recent U.S. Congressional pronouncements to uphold the primacy of their immigration policy, thus, no more similar liberal agreements could be entered into. Issues on the movement of workers, particularly mutual recognition, accreditation, taxation and the refund of social security contributions were raised. For the educational sector, the issue of public subsidy and national treatment of foreign service providers were also brought up to clarify the objective of bringing access to students. The paper concluded that for an FTA concerning the movement of natural persons to materialize, the Philippines should weigh its sacrifices against what it will be requesting from the U.S. within the context of the overall importance of the maximizing opportunities for the Filipino worker.
    Keywords: trade liberalization, labor market, labor migration, market access, General Agreement on Trade in Services (GATS), movement of natural persons, free trade agreement (FTA), services trade, modes of supply, educational system, cross-border transactions, reciprocity, preferential treatment, national treatment, mutual recognition agreement
    Date: 2006
  17. By: M.A.B. Siddique (Department of Economics, The University of Western Australia)
    Date: 2006
  18. By: Romain Aeberhardt (CREST-INSEE); Julien Pouget (CREST-INSEE and IZA)
    Abstract: This paper attempts to explain national origin wage differentials in France. Our data come from a matched employer-employee wage survey performed in 2002. Business survey data are matched to many individual-level variables collected in a household survey. The sample of professionals is decomposed into several sub-samples: within each gender, a distinction is made according to the parents’ birthplace (France, North Africa and Southern Europe). We perform a switching regression model of wage determination and occupational employment. Our results suggest that earnings differentials mostly reflect differences in the type of jobs taken up by individuals, according to their experience, background and education. This leads us to favor an interpretation in terms of a certain degree of occupational segregation, rather than mere wage discrimination.
    Keywords: immigration, discrimination, wage gap, France
    JEL: J15 J16 J31 J71
    Date: 2007–05
  19. By: Tor Eriksson; Niels Westergaard-Nielsen
    Abstract: This paper consists of three parts. First, we briefly describe some key features of the labor market in Denmark, some of which contribute to the Danish labor markets behaving quite differently from those in many other European countries. The next two parts exploit detailed linked employer-employee data. In the second part we document in some detail an important aspect of the functioning and flexibility of the labor markets in Denmark: the high level of worker mobility. We show that mobility is about as high, or even higher, as in the highly fluid U.S. labor market. Finally, we describe and examine the wage structure between and within firms and changes therein since 1980, especially with an eye on possible impacts of the trend towards a more decentralized wage determination. The shift towards decentralized wage bargaining has coincided with deregulation and increased product market competition. The evidence is, however, not consistent with stronger competition in product markets eroding firm-specific rents. Hence, the prime suspect is the change in wage setting institutions.
    JEL: J31 J50 J62 J63 M52
    Date: 2007–04
  20. By: Anesi, Vincent; De Donder, Philippe
    Abstract: We develop a model where voters differ in their exogenous income and in their ideological views regarding what we call 'racism'. Electoral competition, modelled à la Levy (2004), takes place between (one or several) parties which propose platforms consisting of both an ideological and an economic dimension. Our objective is to explain the emergence of racist policies when a majority of voters is not racist, and to understand the role played by political parties in this emergence. We first show that, in a pure citizen-candidate model where parties are absent, the only equilibrium consists of the non-racist policy. We then show that allowing for the formation of political parties generates equilibria with racist policies. Finally, our main result states that, if the economic issue is sufficiently salient compared to the ideological one, all equilibria consist of a racist policy, and that the lowest degree of racism of these policies increases with the proportion of poor people in the economy.
    Keywords: electoral competition; polarization; political parties; salience
    JEL: D72
    Date: 2007–05
  21. By: Alberto Alesina (Harvard University, NBER and CEPR); Paola Giuliano (Harvard University, IMF and IZA)
    Abstract: The structure of family relationships influences economic behavior and attitudes. We define our measure of family ties using individual responses from the World Value Survey regarding the role of the family and the love and respect that children need to have for their parents for over 70 countries. We show that strong family ties imply more reliance on the family as an economic unit which provides goods and services and less on the market and on the government for social insurance. With strong family ties home production is higher, labor force participation of women and youngsters, and geographical mobility, lower. Families are larger (higher fertility and higher family size) with strong family ties, which is consistent with the idea of the family as an important economic unit. We present evidence on cross country regressions. To assess causality we look at the behavior of second generation immigrants in the US and we employ a variable based on the grammatical rule of pronoun drop as an instrument for family ties. Our results overall indicate a significant influence of the strength of family ties on economic outcomes.
    Keywords: family ties, culture, home production and market activities, immigrants
    JEL: Z10 Z13
    Date: 2007–04
  22. By: Louka T. Katseli; Robert E.B. Lucas; Theodora Xenogiani
    Abstract: La gestion des migrations – problème complexe s’il en est – fait désormais partie des priorités des décideurs, dans les pays développés comme dans les pays en développement. Lorsque les flux migratoires – émigration ou immigration – sont importants pour la population d’un pays, pratiquement tous les aspects d’une économie et d’une société s’en ressentent : structures familiales, vie communautaire, systèmes d’éducation et de santé, marchés du travail, systèmes de sécurité, gouvernance et institutions. Malgré les difficultés inhérentes à l’élaboration de politiques, les décideurs prennent davantage conscience de l’intérêt d’une gestion améliorée de ces flux, dont bénéficieraient autant les pays d’accueil que les pays d’origine des migrants. Une gestion efficace peut en outre atténuer les risques associés aux migrations....
    Date: 2006–10

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