nep-mig New Economics Papers
on Economics of Human Migration
Issue of 2011‒09‒22
nine papers chosen by
Yuji Tamura
Australian National University

  1. Emigration and Wages: The EU Enlargement Experiment By Benjamin Elsner;
  2. Does Culture Affect Divorce Decisions? Evidence from European Immigrants in the US By Furtado, Delia; Marcén, Miriam; Sevilla-Sanz, Almudena
  3. Modern Day Slavery: What Drives Human Trafficking in Europe? By Hernandez, Diego; Rudolph, Alexandra
  4. The Impact of Cultural Diversity on Innovation: Evidence from Dutch Firm-Level Data By Ceren Ozgen
  5. Who Contributes? A Strategic Approach to a European Immigration Policy By Russo, Giuseppe; Senatore, Luigi
  6. Migrant Entrepreneurs and Credit Constraints under Labour Market Discrimination By Frijters, Paul; Kong, Tao; Meng, Xin
  7. Low-Skilled Immigrants and the U.S. Labor Market By Duncan, Brian; Trejo, Stephen
  8. Remittances in Pakistan - Why have they gone up, and why aren’t they coming down? By Udo Kock; Yan Sun
  9. Financial Liberalization and the Brain Drain: A Panel Data Analysis By Mitra, Aniruddha; Bang, James T.; Wunnava, Phanindra V.

  1. By: Benjamin Elsner (Department of Economics, Trinity College Dublin);
    Abstract: This paper studies the impact of a large emigration wave on real wages in the source country. Following EU enlargement in 2004, a large share of the workforce of the Central and Eastern Europe emigrated to Western Europe. Using data from Lithuania for the calibration of a factor demand model I show that emigration had a significant short-run impact on real wages in the source country. In particular, emigration led to a change in the wage distribution between young and old workers. The wages of young workers increased by 6%, whereas the wages of old workers decreased by around 1%. On the contrary, I find no effect on the wage distribution between workers of different education levels.
    Keywords: Emigration, EU Enlargement, European Integration, Wage Distribution
    JEL: F22 J31 O15 R23
    Date: 2011–01
  2. By: Furtado, Delia (University of Connecticut); Marcén, Miriam (University of Zaragoza); Sevilla-Sanz, Almudena (University of Oxford)
    Abstract: This paper explores the role of culture in determining divorce decisions by examining country of origin differences in divorce rates of immigrants in the United States. Because childhood-arriving immigrants are all exposed to a common set of US laws and institutions, we interpret relationships between their divorce tendencies and home country divorce rates as evidence of the effect of culture. Our results are robust to controlling for several home country variables including average church attendance and GDP. Moreover, specifications with country of origin fixed effects suggest that divorce probabilities are especially low for immigrants from countries with low divorce rates that reside amidst a large number of co-ethnics. Supplemental analyses indicate that divorce culture has a stronger impact on the divorce decisions of females than of males pointing to a potentially gendered nature of divorce taboos.
    Keywords: immigrants, culture, divorce
    JEL: J12 Z13 J61
    Date: 2011–09
  3. By: Hernandez, Diego; Rudolph, Alexandra
    Abstract: At a time of increased attention on the international agenda for human trafficking, this paper examines the determinants of human trafficking inflows in to 13 European countries based on official records. By employing a fixed effects zero-inflated, negative binomial gravity-type model, we address data characteristics appropriately. The econometric analysis suggests that human trafficking occurs in well established routes for migrants and refugees. Victims are more likely to be transported to, and exploited in, host countries with suboptimal institutional quality levels. Countries whose nationals do not require a visa for short term visits are especially prone to being potential source countries. Legal status and regulation of commercial sex services does not affect the pattern of trafficking flows. --
    Keywords: Human trafficking,Gravity Model,Illegal Migration,International Organized Crime
    JEL: F22 J61 K14 K42 O17
    Date: 2011
  4. By: Ceren Ozgen (Department of Spatial Economics, VU University Amsterdam)
    Abstract: Due to the growth in international migration in recent decades, the workforce of firms in host countries has become considerably more diverse, both demographically and culturally. It is an important question for firms and for governments to ask whether there are some productivity-enhancing externalities gained from this growing diversity within firms. In recent years migration research has demonstrated positive economic impacts of cultural diversity on productivity and innovation at the regional level. However, there is a dearth of research on the links between innovation and migrant diversity at the firm level. In this paper we construct and analyse a unique linked employer-employee micro-dataset of 4582 firms, based on survey and administrative data obtained from Statistics Netherlands. Excluding firms in the hospitality industry and other industries that employ low-skilled migrants, we use the local number of restaurants with foreign cuisines and the historical presence of migrant communities as valid instruments of endogenous migrant settlement. We find that firms in which foreigners account for a relatively large share of employment are somewhat less innovative. However, there is strong evidence that firms that employ a more diverse foreign workforce are more innovative, particularly in terms of product innovations.
    Keywords: immigration, innovation, cultural diversity, knowledge spillovers, linked employer-employee data, Netherlands
    JEL: F22 O31
    Date: 2011–09
  5. By: Russo, Giuseppe; Senatore, Luigi
    Abstract: According to the Lisbon Treaty the increasing cost of enforcing the European border against immigration shall be shared among the EU members. Nonetheless, the Treaty is rather vague with respect to the "appropriate measures" to adopt in order to distribute the financial burden. Members who do not share their borders with source countries have an incentive to free ride on the other countries. We study a contribution game where a northern government and a southern government minimize a loss function with respect to their national immigration target. We consider both sequential and simultaneous decisions and we show that the contribution of both governments is positive when their immigration targets are not too different. We show that total contribution is higher when decisions are simultaneous, but the conditions for both contributions to be positive are less restrictive in the sequential framework.
    Keywords: Policy making; Government expenditures; Local government expenditures; Federalism
    JEL: H77 H72 H41 D78
    Date: 2011–08
  6. By: Frijters, Paul (University of Queensland); Kong, Tao (Australian National University); Meng, Xin (Australian National University)
    Abstract: We use a unique data of representative migrants and urban local workers in 15 Chinese cities to investigate entrepreneurship and credit constraints under labour market discrimination. We divide self employed into prefer to be self-employed and prefer to have a salaried job but cannot find one; and divide salaried workers into want-to-be entrepreneurs and happy-to-be salaried workers. Over 40 percent of migrant workers are either currently or want-to-be entrepreneurs. Both groups are very similar in terms of risk taking preferences and network size. Want-to-be entrepreneurs however suffer from credit constraints identified by negative financial shocks in the year before. Our back-of-envelope calculation reveals that overcoming the current level of credit constraints may be worth 2% of GDP per year direct earnings increases.
    Keywords: entrepreneurs, credit constraints, migration, China
    JEL: L26 J14 J70
    Date: 2011–09
  7. By: Duncan, Brian (University of Colorado Denver); Trejo, Stephen (University of Texas at Austin)
    Abstract: Over the last several decades, two of the most significant developments in the U.S. labor market have been: (1) rising inequality, and (2) growth in both the size and the diversity of immigration flows. Because a large share of new immigrants arrive with very low levels of schooling, English proficiency, and other skills that have become increasingly important determinants of success in the U.S. labor market, an obvious concern is that such immigrants are a poor fit for the restructured American economy. In this chapter, we evaluate this concern by discussing evidence for the United States on three relevant topics: the labor market integration of immigrants, the socioeconomic attainment of the U.S.-born descendants of immigrants, and the impact of immigration on the wages and employment opportunities of native workers. We show that low-skilled immigrants have little trouble finding paid employment and that the wages they earn are commensurate with their skills. Overall, the U.S.-born second generation has achieved economic parity with mainstream society; for some Hispanic groups, however, this is not the case. Finally, we survey the pertinent academic literature and conclude that, on the whole, immigration to the United States has not had large adverse consequences for the labor market opportunities of native workers.
    Keywords: immigrant labor, assimilation, generational progress
    JEL: J61 J62 J68
    Date: 2011–09
  8. By: Udo Kock; Yan Sun
    Abstract: The flow of workers’ remittances to Pakistan has more than quadrupled in the last eight years and it shows no sign of slowing down, despite the economic downturn in the Gulf Cooperation Council (GCC) and other important host countries for Pakistani workers. This paper analyses the forces that have driven remittance flows to Pakistan in recent years. The main conclusions are: (i) the growth in the inflow of workers’ remittances to Pakistan is in large part due to an increase in worker migration; (ii) higher skill levels of migrating workers have helped to boost remittances; (iii) other imporant determinants of remittances to Pakistan are agriculture output and the relative yield on investments in the host and home countries.
    Keywords: Capital inflows , Cross country analysis , Economic models , Migration , Pakistan , Workers remittances ,
    Date: 2011–08–17
  9. By: Mitra, Aniruddha (Middlebury College); Bang, James T. (St. Ambrose University); Wunnava, Phanindra V. (Middlebury College)
    Abstract: This paper explores the impact of financial liberalization on the migration of high skilled labor from 46 countries to the OECD, taken at five year intervals over the period 1985-2000. Using an exploratory factor analysis, we are able to distinguish between two dimensions of financial liberalization, namely the robustness of the markets and their freedom from direct government control. We find that a standard deviation improvement in the robustness of the source country financial sector magnifies the extent of brain drain by a factor of about four percentage points on the average. However, a corresponding increase in the freedom of the source country financial sector from government control has a modest negative impact on the emigration of high skilled labor and the effect is not statistically significant. Further, the impact of improved financial sector robustness on selection is more pronounced for non-OECD economies than for OECD nations, which experience virtually no impact on skilled emigration.
    Keywords: immigration, financial liberalization, brain drain, institutions
    JEL: F22 O15 P48
    Date: 2011–09

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