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Immigrants and Firms' Outcomes: Evidence from France

Cristina Mitaritonna (), Gianluca Orefice () and Giovanni Peri ()

No 22852, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: In this paper we analyze the impact of an increase in the local supply of immigrants on firms’ outcomes, allowing for heterogeneous effects across firms according to their initial productivity. Using micro-level data on French manufacturing firms spanning the period 1995-2005, we show that a supply-driven increase in the share of foreign-born workers in a French department (a small geographic area) increased the total factor productivity of firms in that department. Immigrants were prevalently highly educated and this effect is consistent with a positive complementarity and spillover effects from their skills. We also find this effect to be significantly stronger for firms with low initial productivity and small size. The positive productivity effect of immigrants was also associated with faster growth of capital, larger exports and higher wages for natives. Highly skilled natives were pushed towards firms that did not hire too many immigrants spreading positive productivity effects to those firms too. Because of stronger effects on smaller and initially less productive firms, the aggregate effects of immigrants at the department level on average productivity and employment was small.

JEL-codes: E25 F22 J15 J61 (search for similar items in EconPapers)
Date: 2016-11
New Economics Papers: this item is included in nep-eff, nep-eur, nep-his, nep-int, nep-lab, nep-mig, nep-sbm and nep-ure
Note: ITI LS PR CH
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Published as Mitaritonna, Cristina & Orefice, Gianluca & Peri, Giovanni, 2017. "Immigrants and firms’ outcomes: Evidence from France," European Economic Review, Elsevier, vol. 96(C), pages 62-82.

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