On the Pro-Trade Effects of Immigrants

Massimiliano Bratti, Luca De Benedictis () and Gianluca Santoni

No 6628, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: In this paper we investigate the causal effect of immigration on trade flows, using Italian panel data covering very small geographical units (NUTS-3). Exploiting the very favorable setup offered by Italy's features – the very high number of countries of origin of immigrants ('super-diversity'), the high heterogeneity of social and economic characteristics of Italian provinces coupled with the absence of cultural (e.g. language) or historical (colonial ties) attractors for immigration –, controlling for a wide set of fixed effects, and dealing with the possible distortions generated by the inappropriate choice of the areal unit, we find a positive association between immigrants' stocks and both export and import flows, in line with the past literature. However, using instrumental variables based on migration enclaves, we show that immigrants have a positive and significant effect on imports only.

Keywords: MAUP; business and social networks effects; transplanted-home bias effect; migration; trade; gravity model; super-diversity (search for similar items in EconPapers)
JEL-codes: F10 F14 F22 R10 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2012-06
New Economics Papers: this item is included in nep-int and nep-mig
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (24)

Published - revised version published in: Review of World Economics, 2014, 150 (3), 557-594

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Related works:
Journal Article: On the pro-trade effects of immigrants (2014)
Working Paper: On the pro-trade effects of immigrants (2013)
Working Paper: On the Pro-Trade Effects of Immigrants (2012)
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