nep-mig New Economics Papers
on Economics of Human Migration
Issue of 2011‒10‒15
fifteen papers chosen by
Yuji Tamura
Australian National University

  1. Income Inequality and Health: Lessons from a Residential Assignment Program By Hans Grönqvist; Per Johansson; Susan Niknami
  2. Does Common Agricultural Policy Reduce Farm Labour Migration? A Panel Data Analysis Across EU Regions By Olper, Alessandro; Raimondi, Valentina; Cavicchioli, Daniele; Vigani, Mauro
  3. Remittances and financial inclusion : evidence from El Salvador By Anzoategui, Diego; Demirguc-Kunt, Asli; Peria, Maria Soledad Martinez
  4. Frequency of contact with foreigners in a homogeneous society: perceived consequences of foreigner increases By Yamamura, Eiji
  5. The Effect of Emigration on Unemployment: Evidence from the Central and Eastern European EU Member States By Pryymachenko, Yana; Fregert, Klas; Andersson, Fredrik N. G.
  6. Culture and household decision making: Native and foreign-born couples' balance of power and labor supply choices in the US By Sonia Oreffice
  7. Mechanisms of peer interactions between native and non-native students: rejection or integration? By Marco Tonello
  8. Immigration and Wages: Evidence from Construction By Bernt Bratsberg; Oddbjørn Raaum
  9. The Impact of Cultural Diversity on Innovation: Evidence from Dutch Firm-Level Data By Ozgen, Ceren; Nijkamp, Peter; Poot, Jacques
  10. Give me your wired and your highly skilled: measuring the impact of immigration policy on employers and shareholders By Carl Lin
  11. Family reunification or point-based immigration system? The case of the U.S. and Mexico By Joel López Real
  12. The French Unhappiness Puzzle: the Cultural Dimension of Happiness By Claudia Senik
  13. European versus non-European immigrants on the Swedish labour market during the recession By Ekberg, Jan
  14. Return migrants : The rise of new entrepreneurs in rural China By Sylvie Demurger; Hui Xu
  15. "Effects of Legal and Unauthorized Immigration on the US Social Security System" By Selcuk Eren; Hugo Benitez-Silva; Eva Carceles-Poveda

  1. By: Hans Grönqvist (SOFI, Stockholm University); Per Johansson (IFAU; Uppsala University; IZA); Susan Niknami (SOFI, Stockholm University)
    Abstract: This paper investigates how income inequality affects health. Although a large literature has shown that inhabitants in areas with greater income inequality suffer from worse health, past studies are severely plagued by inadequate data, non-random residential sorting and reverse causality. We address these problems using longitudinal population hospitalization data coupled with a settlement policy where Swedish authorities distributed newly arrived refugee immigrants to their initial area of residence. The policy was implemented in a way that provides a source of plausibly random variation in initial location. Our empirical analysis reveals no statistically significant effect of income inequality on the probability of being hospitalized. This finding holds also when investigating subgroups more vulnerable to negative health influences and when studying different types of diseases. There is however some indications of a detrimental effect on older persons’ health; but the magnitude of the effect is small. Our estimates are precise enough to rule out large effects of income inequality on health.
    Keywords: Income inequality; Immigration; Quasi-experiment
    JEL: I10 J15
    Date: 2011–10
  2. By: Olper, Alessandro; Raimondi, Valentina; Cavicchioli, Daniele; Vigani, Mauro
    Abstract: This paper deals with the determinants of labour out-migration from agriculture across 153 EU regions over the 1990-2008 period. The central aim is to shed light on the role played by CAP payments on this important adjustment process. Using static and dynamic panel data methods, we show that standard neo-classic drivers, like the relative income and the relative labour share, represented significant determinants of the inter-sectoral migration of the agricultural labour. Overall, CAP payments have contributed significantly to job creation in agriculture, although the magnitude of the economic effect is quite small. Moreover, Pillar I subsidies have exerted an effect from three to five times stronger than Pillar II payments.
    Keywords: Out-farm Migration, CAP Payments, Labour Markets, Panel Data Analysis, Agricultural and Food Policy, Labor and Human Capital, Q12, Q18, O13, J21, J43, J60,
    Date: 2011
  3. By: Anzoategui, Diego; Demirguc-Kunt, Asli; Peria, Maria Soledad Martinez
    Abstract: This paper investigates the impact of remittances on financial inclusion. This is an important issue given recent studies showing that financial inclusion can have significant beneficial effects on households. Using household-level survey data for El Salvador, the authors examine the impact of remittances on households'use of savings and credit instruments from formal financial institutions. They find that although remittances have a positive impact on financial inclusion by promoting the use of deposit accounts, they do not have a significant and robust effect on the demand for and use of credit from formal institutions. If anything, by relaxing credit constraints, remittances might reduce the need for external financing from financial institutions, while at the same time increasing the demand for savings instruments.
    Keywords: Access to Finance,Debt Markets,Population Policies,Remittances,Economic Theory&Research
    Date: 2011–10–01
  4. By: Yamamura, Eiji
    Abstract: Using individual data of Japan, this paper investigates how frequency of contact with foreigners is associated with the perceived outcomes of foreigner increases. Results showed that frequency of contact has a critical effect on perceptions and that its influence varies according to household income level.
    Keywords: Immigration; perceived consequence; homogenous society
    JEL: F22 J15
    Date: 2011–09–28
  5. By: Pryymachenko, Yana (Department of Economics, Lund University); Fregert, Klas (Department of Economics, Lund University); Andersson, Fredrik N. G. (Department of Economics, Lund University)
    Abstract: This paper contributes to the scant empirical literature on the effects of emigration on source countries’ labour markets. Using a novel dataset by Brücker et al. (2009), we investigate whether emigration from the Central and Eastern European (CEE) members of European Union (EU) during the period 2000 to 2007 has contributed to the decline in unemployment observed in these countries. We find that along with structural changes that occurred in the CEE economies during the last decade, emigration indeed had a strong negative effect on unemployment in these countries. A 10 per cent increase in emigration rate leads to around 5 per cent decrease in unemployment rate. Given the minor effect of immigration on host countries’ unemployment found in the literature (including the studies examining the East-West European migration), this paper’s results indicate that the opening up of labour markets following the enlargement of EU in 2004 mainly has had positive effects.
    Keywords: emigration; unemployment; Central and Eastern Europe
    JEL: J21 J31 J61
    Date: 2011–10–06
  6. By: Sonia Oreffice (Universidad de Alicante)
    Abstract: This study investigates how spouses’ cultural backgrounds mediate the role of intra-household bargaining in the labor supply decisions of foreign-born and US-native couples, in a collective-household framework. Using data from the 2000 US Census I show that the labor supplies of US-born couples, and of those foreign-born coming from countries with family institutions similar to the US, are significantly related to bargaining power forces such as differences between spouses in age, and non-labor income, controlling for both spouses’ demographic and socioeconomic characteristics. Households whose culture of origin supports strict and unequal gender roles do not exhibit any association of balance of power and their labor supply decisions. This cultural asymmetry suggests that spousal traits are assessed differently across couples within the US, and that how households make use of their outside opportunities and economic and institutional environment may depend on their ethnicities.
    Keywords: Culture, Household bargaining power, Labor supply.
    JEL: D1 J15 J22
    Date: 2011–09
  7. By: Marco Tonello (Catholic University Milan & University of Milan-Bicocca)
    Abstract: This paper focuses on mechanisms of “peer interactions” among native and non-native students. We present a theoretical framework based on Lazear (2001) education production model and on the “sub-cultural” sociological theory and we test the theoretical predictions exploiting a dataset of Italian junior high school. Results show that non-native school share has small and negative impacts on Language test scores of natives’ peers, while it does not significantly affect Math test scores. The negative effects to natives’ attainment are concentrated in schools characterized by low levels of non-natives’ isolation or where non-natives’ school share is above 10%.
    Keywords: Peer effects, native and non-native students, social interactions
    JEL: J15 I21 I28
    Date: 2011
  8. By: Bernt Bratsberg (Ragnar Frisch Centre for Economic Research); Oddbjørn Raaum (Ragnar Frisch Centre for Economic Research)
    Abstract: To identify relative wage impacts of immigration, we make use of certification and licensing requirements in the Norwegian construction sector that give rise to exogenous variation in immigrant employment shares across trades. Individual panel data reveal substantially lower wage growth for workers in trades with rising immigrant employment than for other workers. Selective attrition from the sector masks the causal wage impact unless accounted for by individual fixed effects. For low and semi-skilled workers, effects of new immigration are comparable for natives and older immigrant cohorts, consistent with perfect substitutability between native and immigrant labor within trade. Finally, we present evidence that immigration reduces price inflation, as price increases over the sample period were significantly lower in activities with growth in the immigrant share than in activities with no or small change in immigrant employment.
    Date: 2011–10
  9. By: Ozgen, Ceren (VU University Amsterdam); Nijkamp, Peter (VU University Amsterdam); Poot, Jacques (University of Waikato)
    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: 2011–10
  10. By: Carl Lin (Beijing Normal University, IZA & Rutgers University)
    Abstract: This paper links finance theory to labor economics in the context of migration and immigration policy. Using event analysis, I measure the impact of immigration policy on the firm profits, in particular the American Competitiveness and Workforce Improvement Act (ACWIA) of 1998 nearly doubled the available number of H-1B visas for skilled foreign workers in FY 1999. The empirical results show that top H-1B visa user industries enjoyed significant and positive excess returns with the passage of the Act, while industries with little need for H-1B visas experienced no significant changes. Several robustness checks support the results.
    Keywords: Skilled immigrants, immigration policy, employers, shareholders, event study, H-1B visa
    JEL: J61 G14 K31
    Date: 2011
  11. By: Joel López Real (Universitat Autónoma de Barcelona)
    Abstract: While the immigration policy in the U.S. is mainly oriented to family reunification, in Australia, Canada and the U.K. it is a points-based immigration system which main objective is to attract high skilled immigrants. This paper compares both immigration policies through the transition for the U.S. and Mexico. I find that: (i) The point system increases the average years of the immigrants by 3.5 years. (ii) The Mexican immigrants suffer a 10% reduction in their effective hours of labor when they move to the U.S. (iii) Migration reduces inequality, more significantly if the immigration policy is the point system and increases output per capita differences between both countries. (iv) The offspring of the immigrants invest more in human capital than the U.S. natives. (v) The earnings ratio immigrants to the U.S. natives is lower under the quota system than under the point system but along the transition it reverses converging at the steady state.
    Keywords: Migration, self-selection, human capital, immigration policies
    JEL: E20 F22 J61 O11
    Date: 2011
  12. By: Claudia Senik (EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris, PSE - Paris-Jourdan Sciences Economiques - CNRS : UMR8545 - Ecole des Hautes Etudes en Sciences Sociales (EHESS) - Ecole des Ponts ParisTech - Ecole Normale Supérieure de Paris - ENS Paris - INRA, Université Paris-Sorbonne - Ministère de l'Education nationale, de l'Enseignement supérieur et de la Recherche)
    Abstract: This article sheds light on the important differences in self-declared happiness across countries of equivalent affluence. It hinges on the different happiness statements of natives and immigrants in a set of European countries to disentangle the influence of objective circumstances versus psychological and cultural factors. The latter turns out to be of non-negligible importance in explaining international heterogeneity in happiness. In some countries, such as France, they are mainly responsible for the country's unobserved idiosyncratic level of (un-)happiness.
    Keywords: Happiness ; Subjective Well-Being ; International Comparisons ; France ; Immigration ; European Social Survey
    Date: 2011–10
  13. By: Ekberg, Jan (Centre for Labour Market Policy Research (CAFO))
    Abstract: Since the end of 2008 there is an economic recession in the world inducing a contraction in the Swedish economy. The recession has to a great extent been a recession in the manufactory sector. During the same period the number employed in the Swedish manufactory sector decreased by about 14 percent. A recovery started in 2010. The study shows that while immigrants born in Europe have not suffered more than natives since late 2008, immigrants born outside Europe have experienced a sharp deterioration in labour market situation compared to natives. The study presents some explanations. From late 2010 the situation has stabilized. There is also a comparison with the labour market situation for immigrants during the recession in the beginning of 1990s. The employment gap between natives and immigrants born outside Europe has not widened as much in the recession 2008 – 2010 as it did during the early 1990s.
    Keywords: Recession; Immigration
    JEL: J01
    Date: 2011–05–01
  14. By: Sylvie Demurger (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure de Lyon); Hui Xu (GATE Lyon Saint-Etienne - Groupe d'analyse et de théorie économique - CNRS : UMR5824 - Université Lumière - Lyon II - École Normale Supérieure de Lyon)
    Abstract: This paper analyzes return migrants' occupational choice upon their return to their home village, by using an original rural household survey conducted in Wuwei county (Anhui province, China) in 2008. We apply two complementary approaches : a horizontal comparative analysis of occupational choice between non-migrants and return migrants, and a vertical investigation of the impact of migration experience on returnees only. Two main findings are drawn up from the estimation of probit models which account for potential selection bias and endogeneity. First, return migrants are more likely to be self-employed and to opt for higher ability jobs than non-migrants. Second, both return savings and the frequency of job changes during migration increase the likelihood for return migrants to become self-employed. These findings suggest that (a) working experience during migration enhances individual's human capital and entrepreneurial ability, and (b) repatriated migration experience is a key stimulating factor in promoting rural entrepreneur activity.
    Keywords: Return migrants ; occupational change ; entrepreneurship ; Asia ; China
    Date: 2011
  15. By: Selcuk Eren; Hugo Benitez-Silva; Eva Carceles-Poveda
    Abstract: Immigration is having an increasingly important effect on the social insurance system in the United States. On the one hand, eligible legal immigrants have the right to eventually receive pension benefits but also rely on other aspects of the social insurance system such as health care, disability, unemployment insurance, and welfare programs, while most of their savings have direct positive effects on the domestic economy. On the other hand, most undocumented immigrants contribute to the system through taxed wages but are not eligible for these programs unless they attain legal status, and a large proportion of their savings translates into remittances that have no direct effects on the domestic economy. Moreover, a significant percentage of immigrants migrate back to their countries of origin after a relatively short period of time, and their savings while in the United States are predominantly in the form of remittances. Therefore, any analysis that tries to understand the impact of immigrant workers on the overall system has to take into account the decisions and events these individuals face throughout their lives, as well as the use of the government programs they are entitled to. We propose a life-cycle Overlapping Generations (OLG) model in a general equilibrium framework of legal and undocumented immigrants' decisions regarding consumption, savings, labor supply, and program participation to analyze their role in the financial sustainability of the system. Our analysis of the effects of potential policy changes, such as giving some undocumented immigrants legal status, shows increases in capital stock, output, consumption, labor productivity, and overall welfare. The effects are relatively small in percentage terms but considerable given the size of our economy.
    Keywords: Legal and Undocumented Immigration; Social Security; Remittances; Life-cycle Models; OLG Models; General Equilibrium Models
    JEL: J14 J26 J65
    Date: 2011–10

This nep-mig issue is ©2011 by Yuji Tamura. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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