The Long Term Impacts of Migration in British Cities: Diversity, Wages, Employment and Prices

Nathan, Max (2011): The Long Term Impacts of Migration in British Cities: Diversity, Wages, Employment and Prices.

Abstract

British cities are becoming more culturally diverse, with migration a main driver. Is this growing diversity good for urban economies? This paper explores, using a new 16-year panel of UK cities. Over time, net migration affects both local labour markets and the wider economy. Average labour market impacts appear neutral. Dynamic effects may be positive on UK-born workers’ productivity and wages (via production complementarities for higher skill workers) or negative on employment (if migrants progressively displace lower-skill natives from specific sectors). The results, which survive causality checks, suggest both processes are operating in British cities. Long-term industrial decline and casualisation of entry-level jobs help explain the employment findings.

• Item Type: MPRA Paper
• Language: English
• Keywords: cities, migration, cultural diversity, labour markets, productivity, urban economics
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O18 - Urban, Rural, Regional, and Transportation Analysis ; Housing ; Infrastructure; J - Labor and Demographic Economics > J6 - Mobility, Unemployment, Vacancies, and Immigrant Workers > J61 - Geographic Labor Mobility ; Immigrant Workers; J - Labor and Demographic Economics > J1 - Demographic Economics > J15 - Economics of Minorities, Races, Indigenous Peoples, and Immigrants ; Non-labor Discrimination; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R11 - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes; D - Microeconomics > D2 - Production and Organizations > D24 - Production ; Cost ; Capital ; Capital, Total Factor, and Multifactor Productivity ; Capacity; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R2 - Household Analysis > R23 - Regional Migration ; Regional Labor Markets ; Population ; Neighborhood Characteristics

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