Beyond Wages: The Effects of Immigration on the Scale and Composition of Output

Francesca Mazzolari and David Neumark ()

No 14900, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study potential economic benefits of immigration stemming from two factors: first, that immigrants bring not only their labor supply with them, but also their consumption demands; and second, that immigrants may have a comparative advantage in the production of ethnic goods. Using data on the universe of business establishments located in California between 1992 and 2002 matched with Census of Population data, we find some evidence that immigrant inflows boost employment in the retail sector, which is non-traded and a non-intensive user of immigrant labor. We find that immigration is associated with fewer stand-alone retail stores, and a greater number of large and in particular big-box retailers – evidence that likely contradicts a diversity-enhancing effect of immigration. On the other hand, focusing more sharply on the restaurant sector, for which we can better identify the types of products consumed by customers, the evidence indicates that immigration is associated with increased ethnic diversity of restaurants.

JEL-codes: J18 J2 J61 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab and nep-mig
Date: 2009-04
Note: LS
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