 Immigration and Productivity: Unpacking the Role of Spatial SortingJan Auerbach, Elisa Keller, Julian Neira and Rish Singhania No 20197, CEPR Discussion Papers from Centre for Economic Policy Research Abstract: Foreign-born and US-born workers sort differently across space. This paper examines how spatial sorting affects US productivity by disentangling the roles of worker productivity and local amenities. Using data on labor market outcomes and new measures of user cost of capital across regions, we identify spatial distributions of local amenities and productivity by worker birthplace, including birth state for US-born workers, in a general form under minimal assumptions. We use a productivity decomposition as a diagnostic tool to isolate channels through which immigration contributes to aggregate TFP. The decomposition applied to US Census data from 1980 to 2018 reveals that amenity-induced spatial sorting is the primary driver of TFP gains from immigration, with the largest share coming from foreign-born workers mitigating the birth-state bias of US-born workers. Counterfactual exercises show that the birth-state-bias-mitigation channel accounts for at least 90% of TFP gains from immigration. Keywords: Productivity; Spatial sorting (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:20197 Ordering information: This working paper can be ordered from Access Statistics for this paper More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK. |
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