A capital mistake? The neglected effect of immigration on average wages

Declan Trott

Applied Economics Letters, 2012, vol. 19, issue 9, 873-876

Abstract: Much recent literature on the wage effects of immigration assumes that the return to capital, and therefore the average wage, is unaffected in the long run. If immigration is modelled as a continuous flow rather than a one-off shock, this result does not necessarily hold. A simple calibration with pre-crisis US immigration rates gives a reduction in average wages of 5%, larger than most estimates of the effect on relative wages.

Date: 2012
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Working Paper: A Capital Mistake? The Neglected Effect of Immigration on Average Wages (2011)
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DOI: 10.1080/13504851.2011.607116

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