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The trade effects of skilled versus unskilled migration

Peter H. Egger, Maximilian v. Ehrlich, Douglas R. Nelson

Diskussionsschriften from Universitaet Bern, Departement Volkswirtschaft - CRED

Abstract: In this paper, we assess the role of skilled versus unskilled migration for bilateral trade in a flexible econometric model. Using a large data-set on bilateral skill-specific migration and a flexible novel identification strategy, the functionally flexible impact of different levels of skilled and unskilled immigration on the volume and structure of bilateral imports is identified in a quasi-experimental design. We find evidence of a polarized impact of skillspecific immigration on imports: highly concentrated skilled or unskilled immigrants induce higher import volumes than a balanced composition of the immigrant base. This effect turns out particularly important when institutions are weak. Regarding the structure of imports, we observe that skilled immigrants specifically add to imports in differentiated goods. Both bits of evidence are consistent with a segregation of skill-specific immigrant networks and corresponding trade patterns.

Keywords: Skilled vs. unskilled immigration; Migrant networks; Bilateral trade; Quasirandomized experiments; Generalized propensity score estimation (search for similar items in EconPapers)
JEL-codes: C14 C21 F14 F22 (search for similar items in EconPapers)
Date: 2020-01
New Economics Papers: this item is included in nep-dem, nep-int and nep-ure
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