Immigration, Occupations, and Local Labor Market Outcomes: Theory and Evidence from the United States

Lin Tian, Jonathan Vogel, Gordon Hanson and Ariel Burstein
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Ariel Burstein: UCLA

No 852, 2016 Meeting Papers from Society for Economic Dynamics

Abstract: The last decades have witnessed a large increase in the share of immigrants in the U.S. labor force. How has this wave of immigration affected jobs and wages of U.S. workers? We first study empirically the impact of immigrants on the allocation and wages of domestic workers across occupations and space, exploiting local labor market variation. We find evidence of an occupation crowding-in effect: an increase in immigrants into an occupation increases the share of domestic workers in those occupations. Motivated by this and other facts that we document, we consider an assignment model with multiple regions, occupations, labor groups, and imperfectly substitutable domestic and immigrant workers. The model can generate crowding-in or crowding-out. We then structurally estimate the model's key parameters and use it to study the local and aggregate impact of past and counterfactual immigration policies.

Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:red:sed016:852

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