nep-mig New Economics Papers
on Economics of Human Migration
Issue of 2018‒09‒17
ten papers chosen by
Yuji Tamura
La Trobe University

  2. Immigrant Entrepreneurship in Finland By Fornaro, Paolo
  3. Naturalization and Labor Market Performance of Immigrants in Germany By Regina T. Riphahn; Salwan Saif
  4. Migrants and refugees - perceptions, attitude and social distance. Data from Bulgaria By Lyuba Spasova
  5. The fiscal impact of 30 years of immigration in France: an accounting approach By Ndeye Penda Sokhna; Lionel Ragot; Xavier Chojnicki
  6. The EU Free Movement of Services and the growing mobility of Third-Country Nationals as posted workers By Ninke Mussche; Dries Lens
  7. The effect of culture on home-ownership By Marcén, Miriam; Morales, Marina
  8. Migration and the Spatial Distribution of Economic Activity By Lorenzo Caliendo; Fernando Parro
  9. Dealing with Illegal Immigration: the Role of Informality, Taxation and Trade By Carmen Camacho; Fabio Mariani; Luca Pensieroso
  10. Migration and Business Cycle Dynamics By Christie Smith; Christoph Thoenissen

  1. By: Wineman, Ayala; Jayne, Thomas S.
    Abstract: Migration between rural locations is prevalent in developing countries and has been found to improve economic well-being in Sub-Saharan Africa. This article explores the pathways through which intra-rural migration affects well-being in rural Tanzania. Specifically, we investigate whether such migration enables migrants to access more land, higher quality land, or greater off-farm income generating opportunities that may, in turn, translate into improved well-being. Drawing on a longitudinal data set that tracks migrants to their destinations, we employ a difference-in-differences approach, validated with a multinomial treatment effects model, and find that migration confers a benefit in consumption to migrants. Results do not indicate that this advantage is derived from larger farms or, generally, from more productive farmland. However, across all destinations, migrants are more likely to draw from off-farm or nonfarm income sources, suggesting that even intra-rural migration represents a shift away from a reliance on farm production, and this is likely the dominant channel through which migrants benefit. We conclude that intra-rural migration merits greater attention in the discourse on rural development and structural transformation.
    Keywords: Agricultural and Food Policy, Food Security and Poverty, International Development
    Date: 2017–07–07
  2. By: Fornaro, Paolo
    Abstract: Abstract Immigrant entrepreneurship is the subject of a prolific economic literature, as well as a source of wide public debate. This is because the participation of immigrants to the business community can provide a significant contribution to innovation and to market dynamics. This report touches multiple aspects of immigrant entrepreneurship in Finland, looking at the years from 2006 to 2014. I find that while the number of self-employed immigrants has increased dramatically, the entrepreneurial rate has been stable. Moreover, the immigrant self-employment rate is similar to the one of natives. I find that the median earnings of foreign entrepreneurs are lower than the ones of Finnish entrepreneurs, but this is driven by the different industry distribution. Finally, I find an overrepresentation of foreign workers and entrepreneurs in the Helsinki region, while the immigrants’ self-employment rate is higher in poorer areas. I gather multiple evidence pointing toward the fact that difficulties in the job market push foreign residents to self-employment. For example, I find a negative correlation between the employment rate and the foreign share of entrepreneurial inflows, and a strong negative relationship between the employment rate and the immigrant self-employment rate at the regional level.
    Keywords: Immigrants, self-employment, earnings differentials
    JEL: J24 J61 M13
    Date: 2018–09–13
  3. By: Regina T. Riphahn; Salwan Saif
    Abstract: Naturalization may be a relevant policy instrument affecting immigrant integration in host-country labor markets. We study the effect of naturalization on labor market outcomes of immigrants in Germany. We apply recent survey data and exploit a reform of naturalization rules in an instrumental variable estimation. In our sample of recent immigrants, linear regression yields positive correlations between naturalization and beneficial labor market outcomes. Once we account for the endogeneity of naturalization most coefficients decline in magnitude and lose statistical significance: male immigrants' labor market outcomes do not benefit significantly from naturalization. Naturalization reduces the risks of unemployment and welfare dependence for female immigrants. For males and females, the propensity to hold a permanent contract increase as a consequence of naturalization. The results are robust to modifications of samples and the instrument.
    Keywords: citizenship, migration, naturalization, labor market outcomes, instrumental variables
    JEL: J61 J15 C26
    Date: 2018
  4. By: Lyuba Spasova (Institute for the Study of Societies and Knowledge, Bulgarian Academy of Sciences)
    Abstract: Part of a larger research focused on deviance in the context of intensified migration, the study explores changes in the perceptions of Bulgarians towards migrants and refugees coming to the country or passing by in large numbers in their way to West Europe. Although Bulgaria continues to be predominantly a country of origin of migration, we are currently observing a change of attitudes and reduced solidarity towards migrants and refugees in the country. Drawing on data from a set of representative surveys, we are able to reconstruct a detailed picture of the perceptions and social distance towards migrants. What is more, the design of the survey and samples, enables us to make a comparison and distinction between attitudes of respondents living near centers for temporary accommodation of refugees and the general population, i.e. to study the role and importance of proximity and involvement for social distance, solidarity and perception of migrants and refuges as threat.
    Keywords: migration, attitudes, social distance
    JEL: A14 D74
    Date: 2018–07
  5. By: Ndeye Penda Sokhna; Lionel Ragot; Xavier Chojnicki
    Abstract: This article aims to evaluate the net contribution of immigration to the public finances of France between the late 1970s and the early 2010s. We developed an accounting method that disaggregates the primary deficit into the specific contributions of immigrant population and native population. We show that the net contribution of immigrants is generally negative over a relatively long period, but remains at an extremely low level (+/-0:5% of the french GDP, reduced to +/-0:2%, with the exception of 2011). The relatively negligible effect of immigrants on the public accounts is explained by a favourable demographic structure offsetting their lower net individual contribution. However, the 2008 financial crisis has significantly degraded the economic condition of immigrants. The net per capita contribution of EU immigrants has significantly declined since 2000 and is now similar to values from third country immigrants.
    Keywords: International Migration, Public Finances, Social Protection
    JEL: E62 F22 H62
    Date: 2018
  6. By: Ninke Mussche; Dries Lens
    Abstract: Over the past decades, a rich literature developed discussing the remarkably strong role the European Court of Justice (CJEU) played in shaping a deeply integrated single market and European society. Scholars labelled the CJEU’s influence on Europe’s institutional evolution as the judicialization of the European regime. Some decried this influence as a problem of democratic deficit, others claimed that the CJEU actually adjusts more to state preferences than often assumed. This article empirically contributes to the judicialization debate by assessing the impact of the Vander Elst Case law, which allowed third country nationals (TCNs) to be posted freely across the EU without need to apply for work permits in the countries of posting – and this on the basis of the free movement of services. Making use of unique Belgian data on posting (LIMOSA registration system), we evaluate the degree to which the CJEU’s case law designed a mobility regime for TCN posted workers. Our data demonstrate that this mobility regime – exclusively created by case-law starting 25 years back – is a ‘grand success’ in two ways: 1) data show that this migration regime is successfully used by a growing number of posted TCNs; 2) the same data indicate that the number of TCNs entering based on posting even outnumbers the TCNs entering through the classic national migration route of work permit and visa. This small regime – carved out through the cooperation of the Court and the EU Commission – further lessens the migration sovereignty of Member States. At the same time, the rising use of posting indicates the increasing role of the free movement of services in developing a single European labour market.
    Date: 2018–07
  7. By: Marcén, Miriam; Morales, Marina
    Abstract: In this paper, we analyze the role of culture in determining whether, or not, an individual is a homeowner. We use data on first-generation immigrants who arrived in the United States under 6 years old. Following the epidemiological approach, those early-arrival immigrants grew up under the same US laws, markets, and institutions, so any dissimilarity in the proportion of homeowners by country of origin may be interpreted as a consequence of cultural differences. Our estimates indicate that there is a positive and statistically significant relationship between the cultural proxy, that is, the proportion of individuals who are homeowners by country of origin, and the immigrants' choice of home-ownership. Results are maintained after controlling for home-country observable and unobservable characteristics, and are consistent in several subsamples. Neither the differences in the formation of couples (same or different origin) nor the existence (or not) of mortgage financing appear to be driving our findings. Additionally, we present evidence of different mechanisms of transmission of culture (horizontal transmission, respect for elders, and gender roles), which reinforces our results on the cultural effect.
    Keywords: Culture,Immigrants,Home-ownership
    JEL: J15 R20 Z13
    Date: 2018
  8. By: Lorenzo Caliendo (Yale University); Fernando Parro (Johns Hopkins University)
    Abstract: In this paper we propose a model that endogenizes the mechanism by which an economy changes its productive structure. The channel that fosters growth is the increase in productivity in the urban sector that encourages agents from the rural sector to migrate. They do so in order to have access to better opportunities, however they need to accumulate human capital before migrating, which is costly, and this generates a selection of agents that migrate. We are able to characterize the equilibrium of the economy and test its quantitative implications concluding that opening the economy to new technologies together with a relative increase in the marginal return on urban specific human capital are sufficient to make countries start changing their productive structure.
    Date: 2018
  9. By: Carmen Camacho (PARIS SCHOOL OF ECONOMICS and CNRS); Fabio Mariani (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES)); Luca Pensieroso (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))
    Abstract: We develop a two-good, three-sector model of a small open economy with illegal immigration and both formal and informal production. In this framework, we explore the consequences of fiscal policy and trade openness for illegal immigration and the shadow economy. We find that (i) the effect of trade openness on illegal immigration crucially depends on the degree of substitutability between native and illegal labor in the informal sector, (ii) the reach of fiscal policy goes beyond its traditional domain: fiscal instruments can be effectively used as immigration policy tools.
    Keywords: Illegal immigration; Informal sector; Shadow economy; Taxation; Immigration policy; Globalisation; Open economy
    JEL: O17 F22 J61
    Date: 2018–05–20
  10. By: Christie Smith; Christoph Thoenissen (Reserve Bank of New Zealand)
    Abstract: We examine the business cycle effects that arise from an expansion of the population due to migration. We identify the contribution that migration shocks make to cyclical fluctuations, and illustrate their dynamic impact. The analysis presented here is conducted in per capita terms. We develop a dynamic stochastic general equilibrium (DSGE) model to explore the consequences of migration. Households consume foreign- and domestically-produced goods, and housing. Domestically-produced goods are produced using effective labour and physical capital, where effective labour is a composite of physical labour and human capital. The level of human capital is particularly important for the dynamics of the migration shock as it amplifies the labour supply impact of a migration impulse. The model also embodies other frictions. Physical capital, for example, has a variable utilisation rate and adjusting the stock of capital is costly. Variable utilisation and capital adjustment costs are important for the dynamics of shocks. Variable utilisation provides an extra margin of adjustment in response to a shock, while capital adjustment costs serve to slow the propagation of shocks to investment. The model has three stocks of capital: physical capital; housing; and human capital. A migration inflow erodes the per capita stock of physical and housing capital, but the effect on the stock of human capital is ambiguous because migrants may have more or less human capital than domestic residents. The stock of migrant human capital relative to local resident human capital has a material impact on the dynamics of the migration impulse and on the contribution that migrant shocks make to business cycle fluctuations. Using the estimated DSGE model, we show that migration shocks account for a considerable portion of the variability of per capita gross domestic product (GDP). While migration shocks matter for the capital investment and consumption components of per capita GDP, there are other drivers of cyclical fluctuations in these expenditure components that are even more important. Migration shocks also matter for residential investment and real house prices, but once again other shocks play a larger role in driving volatility. In the DSGE model, the level of human capital possessed by migrants relative to that of locals materially affects the business cycle impact of migration. The impact of migration shocks is larger when migrants have substantially different – larger or smaller – levels of human capital relative to locals. When the average migrant has higher levels of human capital than locals, as seems to be common in most OECD economies, a migration shock has an expansionary effect on per capita GDP and its components, which also accords with the evidence from a restricted structural vector autoregression.
    Date: 2018–08

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