Do Immigrants Compete with Natives?

Andrea Gavosto, Alessandra Venturini and Claudia Villosio

LABOUR, 1999, vol. 13, issue 3, 603-621

Abstract: The paper analyses the impact of foreign workers on the Italian labour market. We address the issue of whether immigrants from less developed countries are complementary or substitutes to domestic workers. We construct a data set on immigrant workers from the Administrative Social Security Archive which starts in 1986, before the general amnesty of 1990–91, when a large share of illegal immigrants were granted working permits, and end in 1995. A two‐stage procedure devised by Moulton is applied to yearly cross‐sections of wages by industry and region. Our results show that the inflow of immigrants raises the wages of native manual workers (i.e. it has a complementary effect), and this effect is larger in small firms and in the north of the country. We postulate that the positive impact on native wages is due to the existence of labour constraints on the side of firms. Firms are unable to expand their output because they cannot find native workers who are willing to undertake certain (typically low‐skilled) jobs. Immigrants help to fill this gap. This view is reinforced by the fact that over a ‘crucial threshold’ of the share of foreign work (7.7–12 percent) additional inflows in the labour market of foreign work have a negative effect on native wages (i.e. they compete with natives).

Date: 1999
References: Add references at CitEc
Citations: View citations in EconPapers (56)

Downloads: (external link)
https://doi.org/10.1111/1467-9914.00108

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:labour:v:13:y:1999:i:3:p:603-621

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1121-7081

Access Statistics for this article

LABOUR is currently edited by Franco Peracchi

More articles in LABOUR from CEIS Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().