Instrumental Variables and Omitted Migrant Flows: Immigration and Emigration in Peru

Orlando Ángel Díaz Rivera

UC3M Working papers. Economics from Universidad Carlos III de Madrid. Departamento de Economía

Abstract: Instrumental variables are often used to identify the causal effect of immigration on labor market outcomes of natives. In this paper, I investigate the sensitivity of 2SLS estimators in the (common) case where a simultaneous shock occurs to the unit of interest and we do not explicitly account for it. For this purpose, I estimate the effects of both the Venezuelan immigration shock and the Peruvian emigration during the last decades on the labor market outcomes of Peruvian native stayers. Using shift-share instruments, I document positive effects of both immigration and emigration on employment rates, household income, and household expenditure (with emigration effects being about eight times larger). Reassuringly for the literature, even in a context of instruments correlated with the omitted flow the point estimates are shown to be robust to the inclusion of the omitted variable.

Date: 2025-09-04
New Economics Papers: this item is included in nep-lab and nep-mig
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://e-archivo.uc3m.es/rest/api/core/bitstreams ... 3d6959ee2477/content (application/pdf)

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:cte:werepe:47870

Access Statistics for this paper

More papers in UC3M Working papers. Economics from Universidad Carlos III de Madrid. Departamento de Economía
Bibliographic data for series maintained by Ana Poveda ().