Kangasniemi, M. and Mas, Matilde and Robinson, C. and Serrano, Lorenzo (2008): The Economic Impact of Migration – Productivity Analysis for Spain and the UK. Published in: EU KLEMS Working Paper No. 30 (2008)
Download (282kB) | Preview
As a consequence of increased internationalization over the past 20 years labour has become increasingly mobile, and yet the implications for firm and industry performance have been largely ignored. This paper explores the direct economic consequences of immigration on host nations’ productivity performance at a sectoral level. We consider its impact in two very different European countries, Spain and the UK. Whilst the UK has traditionally had a substantial in-flow of migration, for Spain, the phenomenon is much more recent. The paper provides an overview of the role played by immigration on per capita income, highlighting the importance of demographic differences. We then go on to analyze the role of migration on productivity using two different approaches: i) growth accounting methodology and ii) econometric estimation of a production function. Our findings indicate that migration has had very different implications for Spain and the UK, migrants being more productive than natives in the UK but less productive than natives in Spain. This may in part be a function of different immigration policies, particularly related to the skill requirements on entry, but also in part a feature of the host nations’ ability to ‘absorb’ foreign labour.
|Item Type:||MPRA Paper|
|Original Title:||The Economic Impact of Migration – Productivity Analysis for Spain and the UK|
|Subjects:||O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O47 - Empirical Studies of Economic Growth ; Aggregate Productivity ; Cross-Country Output Convergence
J - Labor and Demographic Economics > J1 - Demographic Economics > J11 - Demographic Trends, Macroeconomic Effects, and Forecasts
|Depositing User:||Matilde Mas|
|Date Deposited:||24. Jun 2009 00:10|
|Last Modified:||14. Feb 2013 10:51|
Angrist, Joshua & Kugler, Adriana, 2003. “Protective or Counter-Productive? Labor Market Institutions and the Effect of Immigrations on EU Natives", Economic Journal, 113, pp. F302-F331.
Blackorby, Charles and R. Robert Russell, 1989. “Will the Real Elasticity of Substitution Please Stand Up? (A Comparison of the Allen/Uzawa and Morishima Elasticities).” The American Economic Review, Vol. 79, No. 4 (Sep., 1989), pp. 882-888.
Blundell, Richard & Bond, Stephen R, 2000. “GMM Estimation with Persistent Panel Data: An Application to Production Functions.” Econometric Reviews. 2000; 19(3): 321-40.
Borjas, George, 1999. "The Economic Analysis of Immigration," in Handbook of Labor Economics, Volume 3A, edited by Orley Ashenfelter and David Card, North-Holland, 1999, pp. 1697-1760.
Borjas, George, 2003. "The Labour Demand Cure IS Downwards Sloping: Re-examining the Impact of Immigration on the Labour Market," Quarterly Journal of Economics, Vol 188, pp. 1335-1374.
Card, David, 1990. “The Impact of the Mariel Boatlift on the Miami Labor Market.” Industrial and Labor Relations Review, 43(2), pp. 245-57.
Card, David, 2001. “Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration.” Journal of Labor Economics, 19(1), pp. 22-64.
Card, David & DiNardo, John, 2000. “Do Immigrant Inflows Lead to Native Outflows?”, American Economic Review, 90(2), pp. 360-67.
Card, David, 2005. “Is the New Immigration Really So Bad?” Economic Journal, Vol 115, pp. F300-F323.
Carrasco, R., Jimeno, J.F. and C. Ortega, 2007: El efecto de la inmigración sobre las condiciones de los trabajadores autóctonos en el mercado de trabajo. Evidencia para España in Dolado, J.J. and P. Vázquez, eds.
Christensen, Laurits R, Jorgenson, Dale W & Lau, Lawrence J, 1973. “Transcendental Logarithmic Production Frontiers”, Review of Economics and Statistics, 55(1), pp. 28-45.
Costello, D., 1993, “A cross-country, cross-industry comparison of productivity growth. Journal of Political Economy 101 (2), 207-222
Dolado, J.J. and P. Vázquez, eds., 2007, Ensayos sobre los efectos económicos de la inmigración en España, Fundación de Estudios de Economía Aplicada, FEDEA, Madrid.
Friedberg, Rachel M & Hunt, Jennifer, 1995. "The Impact of Immigrants on Host Country Wages, Employment and Growth," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 23-44, Spring.
Griliches Zvi & Jacques Mairesse, 1995. "Production Functions: The Search for Identification," NBER Working Papers 5067, National Bureau of Economic Research, Inc.
Grossman, Jean Baldwin, 1982. “The Substitutability of Natives and Immigrants in Production.” Review of Economics and Statistics. 64(4), pp. 596-603.
Hamermesh, Daniel S & Grant, James, 1979. “Econometric studies of labor-labor substitution and their implications for policy.” Journal of Human Resources, XIV(4), pp. 518–542.
Hatton, Timothy J. 2005, “Explaining trends in UK immigration”, Journal of Population Economics, 18; 719-740.
Heyer Eric & Florian Pelgrin & Arnaud Sylvain, 2004. "Translog ou Cobb-Douglas? Le rôle des durées d'utilisation des facteurs," Working Papers 04-19, Bank of Canada.
Hitt Lorin M. and Eli M. Snir “The Role of Information Technology in Modern Production: Complement or Substitute to Other Inputs,” Mimeo
Huntoon, Laura, 1998, “Immigration to Spain: implications for a unified European Union Immigration Policy”, International Migration Review, 32 (2); 423-450.
Jorgenson, Dale W, Gollop, Frank M & Fraumeni, Barbara M, 1987. “Productivity and U.S. economic growth” Harvard Economic Studies, vol. 159, Cambridge, Mass.: Harvard University Press, 1987; 567.
Levinsohn James and Amil Petrin, "Estimating Production Functions Using Inputs to Control for Unobservables," April 2003, pp. 317-342. Review of Economic Studies .
Manacorda, M, Manning, Alan & Wadsworth, Jonathan, 2006. “The Impact of Immigration on the Structure of Male Wages: Theory and Evidence from Britain” Centre for Economic Performance Discussion Papers 754.
Marimon, R., and Zilibotti, F., 1998, “`Actual´ versus `virtual´ employment in Europe. Is Spain different?” European Economic Review 42, 123-153.
Mattoo, Aaditya, Maskus, Keith E & Chellaraj, Gnanaraj, 2005. ”The contribution of skilled immigration and international graduate students to U.S. innovation.” The World Bank, Policy Research Working Paper Series: 3588.
Moen, Jarle, 2005. “Is Mobility of Technical Personnel a Source of R&D Spillovers?” Journal of Labor Economics, 23(1), pp. 81-114.
Office for National Statistics. Social and Vital Statistics Division and Northern Ireland Statistics and Research Agency. Central Survey Unit, Quarterly Labour Force Survey files, 1992-2005 [computer files]. Colchester, Essex: UK Data Archive [distributor].
Office of Population Censuses and Surveys. Social Survey Division, Annual Labour Force Survey files, 1984-1991 [computer files]. Colchester, Essex: UK Data Archive[distributor].
Olley G. Steven and Ariel Pakes, 1996. “The Dynamics of Productivity in the Telecommunications Equipment Industry” Econometrica, Vol. 64, No. 6 (Nov., 1996), pp. 1263-1297.
Ottaviano, Gianmarco I.P. & Peri, Giovanni, 2006. "Rethinking the Effects of Immigration on Wages," NBER Working Papers 12497.
Roodman, David, 2006. "How to Do xtabond2: An Introduction to "Difference" and "System" GMM in Stata," Working Papers 103, Center for Global Development.
Salt, John and Jane Millar, 2006 Foreign labour in the UK: current patterns and trends Labour Market Trends, vol 114, no 10, percentage point 335-355.
Stockman, A., 1988, “Sectoral and national aggregate disturbances to industrial output in seven European countries”, Journal of Monetary Economics 21, 387-409.