Resumen de International migration flows and labor market outcomes: micro and macro evidence
Chapter I is the central and more ambitious chapter of this Thesis. This chapter estimates a labor market equilibrium model that takes into account natives¿ human capital and labor supply adjustments to immigration. These adjustments are important to quantify the effect of immigration on wages. The model is estimated by minimum distance using CPS and NLSY data for 1967-2007. The parameterized model is then used to measure the effect of immigration on wages simulating a counterfactual world without large scale immigration. The main finding is that natives adjusted their human capital as a consequence of immigration, compensating a half of the original fall in wages with additional skills. Nevertheless, I still find important wage effects of immigration.
Chapter II presents evidence on the determinants of migration flows based on a new database of bilateral migration stocks. The new database is constructed collecting information from Statistical Offices from OECD countries. It is based on population censuses and registers, covers the 100% of the immigrant stock, and covers the 1960-2000 period. I present a migration model that extends Grogger and Hanson (2011) to allow for non-linear effects of income gains and moving costs. Individuals from countries that are further apart may require a higher wage premium to compensate them for the disutility of living far away from home (compensating differentials), or to compensate the ongoing flow of costs that individuals face while living far away, such as higher costs of traveling back home from time to time (income maximization). Estimates using the new database suggest that these non-linearities are indeed very important.
Finally, in Chapter III, I use cross-country variation in immigrant rates to identify the effect of immigration on earnings ¿proxied by GDP per capita¿ and on employment prospects ¿employment rate, hours worked, and unemployment rate¿. The cross-country analysis has two main advantages: countries are closed labor markets (more closed than cities), and I can exploit push-targeting interactions as an exogenous source of variation to instrument for endogenous location of immigrants (e.g. a war in Algeria pushes more immigrants to France than to Australia). I estimate sizeable negative effects of immigration on income and em102 Concluding Remarks ployment. Those results imply a step forward in understanding why cross-city analysis finds negligible effects of immigration while the national level approach finds them to be large.
The three chapters include important contributions to the literature. They also open new avenues for further research. Especially, the framework used in Chapter I is very well suited to analyze many additional aspects of the economic consequences of immigration. For example, it would be very interesting to use it to simulate the effect of immigration policies in the US. It is also usable to analyze the very interesting case of Spain, that embeds two important differences with respect to the US: immigration is much concentrated in the very recent years, and, instead of skill-biased technological change, we have seen an important boom in construction throughout these years. Slight modifications of the model can be used to analyze these questions.
Chapters II and III also open ideas for new projects. The database of bilateral migrant stocks can be used in many estimation exercises. Additionally, it would be interesting to analyze what are the implications of non-linearities in the utility function on self-selection of immigrants in terms of skills. And the empirical analysis in Chapter III could be extended with micro data from several destination countries.
