nep-mig New Economics Papers
on Economics of Human Migration
Issue of 2018‒09‒03
twenty papers chosen by
Yuji Tamura
La Trobe University

  1. Triple Disadvantage?: A first overview of the integration of refugee women By Thomas Liebig
  2. The long-term impact of employment bans on the economic integration of refugees By Marbach, Moritz; Hainmueller, Jens; Hangartner, Dominik
  3. Should I Stay or Must I Go? Temporary Protection and Refugee Outcomes By Kilström, Matilda; Larsen, Birthe; Olme, Elisabet
  4. Exploitation and the Decision to Migrate: The Role of Abuse and Unfavorable Working Conditions in Filipina Domestic Workers' Desire to Return Abroad By Naufal, George S; Malit, Jr., Froilan T.
  5. The Benefits of Labor Mobility in a Currency Union By Christopher House; Christian Proebsting; Linda Tesar
  6. Migration networks and Mexican migrants' spatial mobility in the US By Rebecca Lessem; Brian Cadena; Brian Kovak; Shan Li
  7. Ethnic Enclaves and Immigrant Outcomes: Norwegian Immigrants during the Age of Mass Migration By Katherine Eriksson
  8. Immigrants' Residential Choices and their Consequences By Joan Monras
  9. Economic links between education and migration: An overview By Handler, Heinz
  10. Immigrant Networks and Remittances: Cheaper together? By Ainhoa Aparicio Fenoll; Zoe Kuehn
  11. The Changing Structure of Immigration to the OECD: What Welfare Effects on Member Countries? By Michal Burzynski; Fre´de´ric Docquier; Hillel Rapoport
  12. The Ethnic Segregation of Immigrants in the United States from 1850 to 1940 By Katherine Eriksson; Zachary A. Ward
  13. A critical comparison of migration policies: Entry fee versus quota By Oded Stark, Lukasz Byra, Alessandra Casarico, and Silke Uebelmesser
  14. From Engineer to Taxi Driver? Language Proficiency and the Occupational Skills of Immigrants By Imai, Susumu; Stacey, Derek; Warman, Casey
  15. Distributional Effects of Local Minimum Wage Hikes: A Spatial Job Search Approach By Weilong Zhang
  16. Location as an Asset By Adrien Bilal; Esteban Rossi-Hansberg
  17. On the taxing of migrants’ earnings while retaining a migrant workforce By Star, Oded; Budzinski, Wiktor
  18. Health Disparities for Immigrants: Theory and Evidence from Canada By Lebihan, Laetitia; Mao Takongmo, Charles Olivier; McKellips, Fanny
  19. Consequences of Immigrating During a Recession: Evidence from the US Refugee Resettlement Program By Mask, Joshua
  20. More educated, less mobile? Diverging trends in income and educational mobility in Chile and Peru By Anja Gaentzsch and Gabriela Zapata Román

  1. By: Thomas Liebig (OECD)
    Abstract: 45% of refugees in Europe are women, yet little is known on their integration outcomes and the specific challenges they face. This report summarises prior research on the integration of refugee women, both compared with refugee men and other immigrant women. It also provides new comparative evidence from selected European and non-European OECD countries. Refugee women face a number of particular integration challenges associated with poorer health and lower education and labour market outcomes compared to refugee men, who are already disadvantaged in comparison with other migrant groups. They also show a peak in fertility in the year after arrival. A large fraction has come from countries where gender inequality is high and employment of women tends to be low. However, there is little correlation between indicators such gender differences in participation and employment in the origin and in the host country, suggesting that the integration issues can be addressed by host-country employment and education policy instruments. The report also finds that building basic skills in terms of educational attainment and host-country language training bears a high return in terms of improving labour market outcomes. It also provides intergenerational pay-off for their children. Against this backdrop, structured integration programmes such as the ones in the Scandinavian countries seem to be a worthwhile investment.
    Keywords: Gender, Immigrants, Integration, Refugees, Women
    JEL: F22 J15 J16
    Date: 2018–08–30
  2. By: Marbach, Moritz; Hainmueller, Jens; Hangartner, Dominik
    Abstract: Many European countries impose employment bans that prevent asylum seekers from entering the local labor market for a certain waiting period upon arrival. We provide evidence on the long-term effects of such employment bans on the subsequent economic integration of refugees. We leverage a natural experiment in Germany, where a court ruling prompted a reduction in the length of the employment ban. We find that five years after the waiting period was reduced, employment rates were about 20 percentage points lower for refugees who, upon arrival, had to wait an additional seven months before they were allowed to enter the labor market. It took up to ten years for this employment gap to disappear. Our findings suggest that longer employment bans considerably slowed down the economic integration of refugees and reduced their motivation to integrate early on after arrival. A marginal social cost analysis for the study sample suggests that this employment ban cost German taxpayers about 40 million Euro per year on average in terms of welfare expenditures and forgone tax revenues from unemployed refugees.
    Keywords: asylum policy; refugee migration; economic integration; employment ban labor market
    JEL: J1
    Date: 2018–08–06
  3. By: Kilström, Matilda; Larsen, Birthe (Department of Economics, Copenhagen Business School); Olme, Elisabet
    Abstract: We study a Danish reform in 2002 that lowered the ex ante probability of refugees receiving permanent residency by prolonging the time period before they were eligible to apply for permanent residency. Assignment to the new rules was completely determined by the date of the asylum application and the reform was implemented retroactively. We formulate a simple search and matching model to derive predictions that can be tested using our data. Then we study the effects on educational and labor market outcomes and find that the reform significantly increased enrollment in formal education, especially for females and low skilled individuals. In terms of employment and earnings, coefficients are in general negative but non-significant. Other outcomes of interest are also studied. The reform had a negative impact on criminal activity driven by a reduction among males. There are no effects on health outcomes and significant but relatively small negative effects on childbearing for females. The results do not seem to be driven by selection, since the reform had no significant effect on the share that stayed in Denmark in the long run.
    Keywords: refugees; human capital; immigration law
    JEL: J15 J24 J61
    Date: 2018–05–09
  4. By: Naufal, George S (Texas A&M University); Malit, Jr., Froilan T. (Cornell University)
    Abstract: The Gulf Cooperation Council (GCC) countries host at least 2.4 million foreign domestic workers, who are legally excluded from national labor laws and regulations, thus placing them in precarious social, legal, and economic conditions in the GCC labor markets. Despite the recent growth of academic scholarship on domestic work in the GCC and beyond, little attention has been paid to absconding foreign domestic workers and the complex role abuse plays in determining their future decision to migrate. This paper examines the likelihood that Filipina domestic workers will migrate after absconding from their previous employer. Applying a unique dataset of absconding Filipina domestic workers collected at the Philippine Labor Office (POLO) in Qatar between 2013 - 2015, we find that abuse and poor working conditions do not act as deterrents for future migration. Paradoxically, absconding domestic workers who have been financially abused are more likely to want to return and seek employment abroad. This study offers empirical and theoretical insights into the connection between migrant exploitation and domestic workers' desire to migrate once again.
    Keywords: migration, absconding, domestic workers, GCC countries, abuse, mobility
    JEL: J61 J68 O15
    Date: 2018–07
  5. By: Christopher House (University of Michigan); Christian Proebsting (EPFL); Linda Tesar (University of Michigan)
    Abstract: Cyclical unemployment rates differ substantially more between countries in the euro area than between states in the United States. We find that net migration is responsive to unemployment differentials, but the response is smaller in Europe relative to the U.S. This paper explores to what extent the lack of labor mobility in Europe makes it more difficult for the euro area to adjust to shocks. We develop a multi-country DSGE model of a currency union with cross-border migration and search frictions in the labor market. The model is calibrated to the 50-state U.S. economy and to the 31-country European economy and replicates, for each region, the relationship between net migration and unemployment differentials. The model allows us to quantify the benefits if Europe had enjoyed levels of labor mobility as high as those in the U.S. during the most recent crisis.
    Date: 2018
  6. By: Rebecca Lessem (Carnegie Mellon University); Brian Cadena (University of Colorado at Boulder); Brian Kovak (Carnegie Mellon University); Shan Li (Carnegie Mellon University)
    Abstract: Mexican low-skilled migrants are found to be highly mobile when they face labor demand shocks. This paper examines the role of migration networks in Mexican-born immigrants’ location choices. We rely on the sizable variation in labor demand declines across states during the Great Recession to identify migration responses to demand shocks and use a novel set of data, the Matrícula Consular de Alta Seguridad (MCAS) data, to construct migration network measures. We find that migration networks indeed play an important part in Mexican migrants’ responsiveness to local demand shocks.In particular, migrants respond to local economic conditions and conditions in network-connected locations when making location decisions.
    Date: 2018
  7. By: Katherine Eriksson
    Abstract: This paper examines the effect of ethnic enclaves on economic outcomes of Norwegian immigrants in 1910 and 1920, the later part of the Age of Mass Migration. Using different identification strategies, including county fixed effects and an instrumental variables strategy based on chain migration, I consistently find that Norwegians living in larger enclaves in the United States had lower occupational earnings, were more likely to be in farming occupations, and were less likely to be in white-collar occupations. Results are robust to matching method and choice of occupational score. This earnings disadvantage is partly passed on to the second generation.
    JEL: J61 N31
    Date: 2018–06
  8. By: Joan Monras (CEMFI)
    Abstract: This paper investigates the causes and effects of the spatial distribution of immigrants across US cities. We document that: a) immigrants concentrate in large, high-wage, and expensive cities, b) the earnings gap between immigrants and natives is higher in larger and more expensive cities, and c) immigrants consume less locally than natives. In order to explain these findings, we develop a simple quantitative spatial equilibrium model in which immigrants consume (either directly, via remittances, or future consumption) a fraction of their income in their countries of origin. Thus, immigrants not only care about local prices, but also about price levels in their home country. Hence, if foreign goods are cheaper than local goods, immigrants prefer to live in high-wage, high-price, and high-productivity cities, where they also accept lower wages than natives. Using the estimated model we show that current levels of immigration have reduced economic activity in smaller, less productive cities by around 3 percent, while they have expanded the activity in large and productive cities by around 4 percent. This has increased total aggregate output per worker by around .15 percent.
    Date: 2018
  9. By: Handler, Heinz
    Abstract: Among the many factors governing migration, education plays a major role, though more in the long run than for short-term floods particularly of irregular migration. Concerning the long run effects, the direction of causation and the slope of the connection are debated in theory. Education not only determines the mobility of people, it also is positively correlated with rising incomes. Empirical evidence shows that for people in developing countries, who are at the low end of the income distribution, more education and rising income levels are push factors for emigration. However, beyond a certain threshold further rising incomes tend to retard migration. As a result, education exhibits an inverted-U shaped relationship with migration. Another remarkable fact is that, on average, people who migrate are better educated than non-migrants back home as well as indigenous people in the host country.
    Keywords: Education, human capital, migration waves, refugees
    JEL: F22 F24 I25
    Date: 2018–05
  10. By: Ainhoa Aparicio Fenoll; Zoe Kuehn
    Abstract: We estimate the causal effects of immigrant networks on individuals' remittance sending behavior for migrants from many different countries residing in Spain. Our methodology addresses typical issues that arise when estimating network effects: reverse causality, common unobserved factors, and self-selection. In particular, we instrument the size of networks by predicting the number of migrants in each lo- cation using the location's accessibility by distinct methods of transportation and information about how migrants from each country arrived in Spain. Our findings show that immigrants from above-average remitting countries remit more if they live in larger networks. Testing for mechanisms of network e ects, we also find that these migrants are more likely to send remittances via bank transfers, which sug- gests that large networks of individuals who remit a lot might be better at sharing information about cheaper remittance channels (bank transfers compared to money orders in post offices or agencies). In line with this hypothesis, we find that due to network effects migrants shy away from the most expensive remittance channels, potentially freeing resources for additional remittances. Furthermore, cost spreads between the most expensive and cheapest providers are lower for countries charac- terized by high remittances and stronger networks, suggesting that network effects might be competition-enhancing.
    Keywords: immigrant networks, remittances, migration, Spain
    JEL: F24 J61 F22 O15 A14
    Date: 2017
  11. By: Michal Burzynski (University of Luxembourg); Fre´de´ric Docquier (Universite Catholique de Louvain); Hillel Rapoport (Paris School of Economics)
    Abstract: We investigate the welfare implications of two pre-crisis immigration waves (1991– 2000 and 2001–2010) and of the post-crisis wave (2011–2015) for OECD native citizens. To do so, we develop a general equilibrium model that accounts for the main channels of transmission of immigration shocks – the employment and wage effects, the fiscal effect, and the market size effect – and for the interactions between them. We parameterize our model for 20 selected OECD member states. We find that the three waves induce positive effects on the real income of natives, however the size of these gains varies considerably across countries and across skill groups. In relative terms, the post-crisis wave induces smaller welfare gains compared to the previous ones. This is due to the changing origin mix of immigrants, which translates into lower levels of human capital and smaller fiscal gains. However, differences across cohorts explain a tiny fraction of the highly persistent, cross-country heterogeneity in the economic benefits from immigration.
    Keywords: immigration, welfare, crisis, Inequality, general equilibrium
    JEL: C68 F22 J24
    Date: 2018–08
  12. By: Katherine Eriksson; Zachary A. Ward
    Abstract: We provide the first estimates of ethnic segregation between 1850 and 1940 that cover the entire United States and are consistent across time and space. To do so, we adapt the Logan-Parman method to immigrants by measuring segregation based on the nativity of the next-door neighbor. In addition to providing a consistent measure of segregation, we also document new patterns such as the high levels of segregation in rural areas, in small factory towns and for non-European sources. Early 20th century immigrants spatially assimilated at a slow rate, leaving immigrants’ lived experience distinct from natives for decades after arrival.
    JEL: F22 J61 N31
    Date: 2018–06
  13. By: Oded Stark, Lukasz Byra, Alessandra Casarico, and Silke Uebelmesser
    Abstract: We ask which migration policy a developed country will choose when its objective is to attain the optimal skill composition of the country’s workforce, and when the policy menu consists of an entry fee and a quota. We compare these two policies under the assumptions that individuals are heterogeneous in their skill level as well as in their skill type, and that individuals of one skill type, say “scientists,” confer a positive externality on overall productivity whereas individuals of the other skill type, say “managers,” do not confer such an externality. We find that a uniform entry fee encourages self-selection such that the migrants are only or mostly highly skilled managers. The (near) absence of migrant scientists has a negative effect on the productivity of the country’s workforce. Under a quota: the migrants are (a) only averagely skilled managers if the productivity externality generated by the scientists is weak, or (b) only averagely skilled scientists if the productivity externality generated by the scientists is strong. In (a), a uniform entry fee is preferable to a quota. In (b), a quota is preferable to a uniform entry fee. If, however, the entry fee for scientists is sufficiently below the entry fee for managers, then migrants will be only or mostly highly skilled scientists, rendering a differentiated entry fee preferable to a quota even when the productivity externality is strong. Instituting a differentiated fee comes, though, at a cost: the fee revenue is not as high as it will be when migrants are only or mostly managers. We conclude that if maximizing the revenue from the entry fee is not the primary objective of the developed country, then a differentiated entry fee is the preferred policy.
    Keywords: Labor and Human Capital
    Date: 2017–07–31
  14. By: Imai, Susumu; Stacey, Derek; Warman, Casey
    Abstract: We examine the ability of immigrants to transfer the occupational human capital they acquired prior to immigration. We first augment a model of occupational choice to study the implications of language proficiency on the cross-border transferability of occupational human capital. We then explore the empirical predictions using information about the skill requirements from the O*NET and a unique dataset that includes both the last source country occupation and the first four years of occupations in Canada. We supplement the analysis using Census estimates for the same cohort with source country occupational skill requirements predicted using detailed human capital related information such as field of study. We find that male immigrants to Canada were employed in source country occupations that typically require high levels of cognitive skills, but rely less intently on manual skills. Following immigration, they find initial employment in occupations that require the opposite. Consistent with the hypothesized asymmetric role of language in the transferability of previously acquired cognitive and manual skills, these discrepancies are larger among immigrants with limited language fluency.
    Keywords: occupational mobility,language proficiency,skills,tasks,human capital,immigration,field of study,Canada,point system,economic immigrants,entry class
    JEL: J24 J31 J61 J62 J71 J80
    Date: 2018
  15. By: Weilong Zhang (University of Pennsylvania)
    Abstract: This paper develops and estimates a spatial general equilibrium job search model to study the effects of local and universal (federal) minimum wage policies. In the model, firms post vacancies in multiple locations. Workers, who are heterogeneous in terms of location and education types, engage in random search and can migrate or commute in response to job offers. I estimate the model by combining multiple databases including the American Community Survey (ACS) and Quarterly Workforce Indicators (QWI). The estimated model is used to analyze how minimum wage policies affect employment, wages, job postings, vacancies, migration/commuting, and welfare. Empirical results show that minimum wage increases in local county lead to an exit of low type (education 12 years), which generates negative externalities for workers in neighboring areas. I use the model to simulate the effects of a range of minimum wages. Minimum wage increases up to $14/hour increase the welfare of high type workers but lower welfare of low type workers, expanding inequality. Increases in excess of $14/hour decrease welfare for all workers. I further evaluate two counterfactual policies: restricting labor mobility and preempting local minimum wage laws. For a certain range of minimum wages, both policies have negative impacts on the welfare of high type workers, but beneficial effects for low type workers.
    Date: 2018
  16. By: Adrien Bilal (Princeton University); Esteban Rossi-Hansberg (Princeton University)
    Abstract: The location of individuals determines their job opportunities, living amenities, and housing costs. We argue that it is useful to conceptualize the location choice of individuals as a decision to invest in a “location asset”. An asset with cost equal to the location’s rent, and with a payoff that determines job opportunities and, potentially, the human capital of children. As with any asset, savers in the location asset transfer resources into the future by going to expensive locations with good opportunities. In contrast, borrowers transfer resources to the present by going to cheap locations that offer few advantages. As with other assets, holdings of this asset depend also on the comparison of its rate of return with that of other assets. Differently from other assets, the location asset is not subject to borrowing constrained so it is used by individuals with little or no wealth that want to borrow. We provide an analytical model to make this idea precise and to derive a number of related implications, including an agent’s mobility choices after experiencing negative income shocks. The model can rationalize why low wealth individuals remain in low income regions with low opportunities. We contrast the core predictions of our theory with detailed French individual panel data.
    Date: 2018
  17. By: Star, Oded; Budzinski, Wiktor
    Abstract: We study policies that are aimed at retaining a migrant workforce in a Gulf State while introducing a tax on migrant earnings. We single out Qatar as a case study. We consider two types of migrants: target migrants, and non-target migrants. If migrants are target migrants, we show that in order to neutralize the effect of a tax on their earnings, Qatar needs to extend the length of time migrants are allowed to stay. Such a scheme can work even when the migrants experience utility loss from staying longer in Qatar. If migrants are non-target migrants, we show that implementation of a lottery scheme in which the prizes are life-long residency in Qatar can “compensate” for the imposition of the tax. In both cases, we present numerical examples that illustrate the magnitudes involved.
    Keywords: Labor and Human Capital, Research Methods/ Statistical Methods
    Date: 2018–07–13
  18. By: Lebihan, Laetitia; Mao Takongmo, Charles Olivier; McKellips, Fanny
    Abstract: Few empirical studies have been conducted to analyse the disparities in health variables affecting immigrants in a given country. To our knowledge, no theoretical analysis has been conducted to explain health disparities for immigrants between regions in the same country that differs in term of languages spoken and income. In this paper, we use the Canadian Community Health Survey (CCHS) to compare multiple health measures among immigrants in Quebec, immigrants in the rest of Canada and Canadian-born individuals. We propose a simple structural model and conduct an empirical analysis in order to assess possible channels that can explain the health disparities for immigrants between two regions of the same country. Our results show that well-being and health indicators worsen significantly for immigrants in Quebec, compared to their counterparts in the rest of Canada and Canadian-born individuals. Additional econometric analysis also shows that life satisfaction is statistically and significantly associated with health outcomes. The proposed structural model predicts that, when the decision to migrate to a particular area is based on income alone, and if the fixed costs associated with the language barrier are large, immigrants may face health issues.
    Keywords: Immigrants, Canadian-born, well-being, health, Quebec.
    JEL: I14 I3 I30 J10
    Date: 2018–06–13
  19. By: Mask, Joshua
    Abstract: I examine long-term employment and wage consequences for refugees who immigrate to the United States under different business cycle conditions. It is difficult to causally identify the relationship between initial economic conditions and subsequent outcomes for most immigrants because they can choose when and where they immigrate. However, refugees offer a unique opportunity to empirically measure these outcomes because their dates of arrival and states of placement are exogenously chosen through the US Refugee Resettlement Program. For every one percentage point increase in the national unemployment rate at arrival, refugees on average experience a 2.99% reduction in wages five years later and a 1.8 percentage point reduction in employment four years later. Estimates using state unemployment rate at arrival show less persistence suggesting mobility or differential economic improvement across states may be important in mitigating these effects. I also divide the sample across gender and educational attainment. I find no evidence of wage scarring for uneducated males but observe a 4.85% reduction in wages five years later for high school-educated males and a 5.29% reduction in wages four years later for college-educated.
    Keywords: Immigration, Labor Market Outcomes, Settlement Policies, Recession
    JEL: J15 J24 J31 J41 J61
    Date: 2018–08–16
  20. By: Anja Gaentzsch and Gabriela Zapata Román
    Abstract: Abstract We analyse intergenerational persistence in income and education in Chile and Peru for birth cohorts of the early 1950s to 1990. Both countries have seen a structural expansion of education over this period and decreasing income inequality in recent decades. We impute non-observed parental income from repeated cross-sections and estimate persistence in the range of 0.63 to 0.67 in Peru and 0.66 to 0.76 in Chile for household heads of the birth cohorts 1977–90. The analysis of educational mobility covers household heads of birth cohorts from 1953 to 1990 and relies on retrospective information. We observe an increase in absolute mobility for younger generations, which we relate to the structural expansion of education that created room at the top. In relative terms, mobility patterns remain more stable – parental education is still a strong predictor of children’s educational achievement. The relationship is non-linear in both countries: persistence among very poorly and highly educated groups is strong, while individuals with parents of average education levels are more mobile. Upward mobility is stronger in Peru than in Chile: the chances to move from no formal education to higher education across one generation are 46% of the average in Peru compared to 20% in Chile. The chances of persisting in the top across generations are also slightly higher in Peru, with a factor of three times the average compared to 2.76 in Chile.
    Date: 2018

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