How Immigration Impacts Natives' Wages: Investigating Cross-Country Differences
Final Report Abstract
France and Germany are two major countries of immigration in Europe. In 2010, foreignborn individuals represented 7.2% and 6.3% of their respective population. Although the economic situation in France and Germany differs a lot in the aftermath of the 2008 crisis (including different dynamics regarding inequality and unemployment) the recent increase in asylum demands and illegal immigration has raised vivid debates on the strictness of immigration policies in both countries. The economic consequences of immigration, especially for native workers, are at the centre of this debate. In three scientific work-packages (WPs), this project will investigate the impact of immigrant workers on natives’ jobs and wages. We devote a specific attention to the impact of immigration on firms (WP1), the interplay between immigration and the labour market (WP2), and the determination of immigration policies taking into account the characteristics of firms and workers (WP3). This project emerges at the interface of migration economics, international trade and the political economy of immigration. WP1 has focused on the demand side of the labour market, by exploring how immigration affects task allocation within and across firms in France. WP2 has consisted in country and cross-country analyses aimed at understanding the effect of immigration on the labour market. WP3 has studied, both theoretically and empirically, the political determinants of immigration policies. Project participants have proved to be complementary in terms of expertise which was a requirement to achieve the project. While both teams have worked on task allocation and production strategies (WP1), the French team has looked at trade integration and aggregate issues (WP2) and the German team has focused on immigration policies (WP3). The project has used both theoretical and quantitative methods (statistical and econometrics approaches) to tackle the research questions at stake. WP1 shows that immigrants can contribute to increasing the productivity of a locality as well as the exports of firms. WP2 focuses on the labour market and shows that, on average, the effect of immigration on the wages of native workers is close to zero. Moreover, this WP improves our understanding of the wage gap between native and immigrant workers, showing that this gap varies according to the export activity of firms. Finally, WP3 highlights the mechanisms for determining immigration policies by taking into account worker and firm characteristics. An article has already been published in the Review of International Economics. This article investigates the export-enhancing effect of employing immigrant workers, and how this effect varies by the type of occupation held. The results show that both low- and high-skilled immigrants increase exports. Other studies from the project have been published as working papers by different research institutions and are currently submitted or under review at scientific journals.
Publications
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Immigrants, occupations and firm export performance. Review of International Economics, 27(5), 1480-1509.
Marchal, Léa & Nedoncelle, Clément
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Immigrant Workers, Firm Export Performance and Import Competition. Documents de Travail du Centre d’Economie de la Sorbonne n° 2021.07 2021
L. Marchal & G. Sabbadini
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Does Immigration Affect Wages? A Meta-Analysis. Document de travail CEPREMAP, n° 2202. 2022
A. Aubry, J. Héricourt, L. Marchal & C. Nedoncelle
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When Immigrants Meet Exporters: A Reassessment of the Immigrant Wage Gap. SSRN Electronic Journal, 2022.
Marchal, Lea; Ourens, Guzmán. & Sabbadini, Giulia
