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The Labour Market Impact of Immigration: Quasi-Experimental Evidence
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The Labour Market Impact of Immigration: Quasi-Experimental Evidence

Author

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  • Albrecht Glitz

    (Centre for Research and Analysis of Migration, Department of Economics, University College London)

Abstract

With the fall of the Berlin Wall, ethnic Germans living in the former Soviet Union and the Warsaw Pact countries were given the chance to migrate to Germany. Within 15 years, 2.8 million individuals moved. Upon arrival, these immigrants were exogenously allocated to different regions by the administration in order to ensure an even distribution across the country. Their inflows can therefore be seen as a natural experiment of immigration, avoiding the typical endogeneity problem of immigrant inflows with regard to local labour market conditions. I analyse the effect of these exogenous inflows on relative skill-specific employment and wage rates of the resident population in different geographical areas between 1996 and 2001. The variation I exploit in the empirical estimations arises primarily from differences in the initial skill composition across regions. Skill groups are defined either based on occupations or educational attainment. For both skill definitions, my results indicate a displacement effect of around 4 unemployed resident workers for every 10 immigrants that find a job. I do not find evidence of any detrimental effect on relative wages.

Suggested Citation

  • Albrecht Glitz, 2006. "The Labour Market Impact of Immigration: Quasi-Experimental Evidence," RF Berlin - CReAM Discussion Paper Series 0612, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    • Handle: RePEc:crm:wpaper:0612
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    References listed on IDEAS

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    Cited by:

    1. Christian Dustmann & Albrecht Glitz & Tommaso Frattini, 2008. "The labour market impact of immigration," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 24(3), pages 478-495, Autumn.
    2. Francesco D’Amuri & Gianmarco I.P. Ottaviano & Giovanni Peri, 2021. "The labor market impact of immigration in Western Germany in the 1990s," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 8, pages 223-243, World Scientific Publishing Co. Pte. Ltd..
    3. Christian Dustmann & Johannes Ludsteck & Uta Schönberg, 2009. "Revisiting the German Wage Structure," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(2), pages 843-881.
    4. repec:ces:ifodic:v:12:y:2014:i:2:p:19116211 is not listed on IDEAS
    5. Florence Kondylis, 2007. "Conflict-Induced Displacement and Labour Market Outcomes: Evidence from Post-War Bosnia and Herzegovina," CEP Discussion Papers dp0777, Centre for Economic Performance, LSE.
    6. Uwe Blien & Linda Borrs & Jens Südekum & Katja Wolf, 2014. "Local Labour Markets and Cultural Diversity," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 12(02), pages 27-34, July.
    7. Kondylis, Florence, 2010. "Conflict displacement and labor market outcomes in post-war Bosnia and Herzegovina," Journal of Development Economics, Elsevier, vol. 93(2), pages 235-248, November.
    8. Uwe Blien & Linda Borrs & Jens Südekum & Katja Wolf, 2014. "Local Labour Markets and Cultural Diversity," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 12(2), pages 27-34, 07.
    9. Gancho Ganchev & Mariya Paskaleva, 2019. "The Relationship between Workforce Migration and the Basic Macroeconomic Variables of the Countries from Central Eastern Europe with a Focus on Bulgaria," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 4, pages 45-69.

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    More about this item

    Keywords

    Immigration; Labour Market Impact; Skill Groups; Germany;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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