On the pro-trade effects of immigrants

Massimiliano Bratti, Luca De Benedictis () and Gianluca Santoni

No 13-014, Working Papers CEB from ULB -- Universite Libre de Bruxelles

Abstract: In this paper we investigate the causal effect of immigration on trade ows using Italian panel data at the province level. We exploit the exceptional characteristics of the Italian data (the fine geographical disaggregation, the very high number of countries of origin of immigrants, the high heterogeneity of social and economic characteristics of Italian provinces, and the absence of cultural or historical ties) and an empirical strategy based on the comparison of estimates at the NUTS-2 and NUTS-3 geographical level, on the use of a wide set of fixed effects, and on instrument based on immigrants' enclaves. The results are that immigrants have a significant positive effect on both exports and imports, much larger for the latter. The pro-trade effects of immigrants tend to decline in space, and even turn negative when large ethnic communities are located too far away from a specific province (via a trade-diversion effect). Finally, we give evidence of a substantial heterogeneity in the effects of immigrants: the impact on trade tends to be larger for immigrants coming from low-income countries, for earlier waves of immigrants and for the less advanced provinces of Southern Italy.

Keywords: Immigration; Trade; Gravity model; Super-diversity; MAUP; Transplanted-home bias effect; Business and social networks effects (search for similar items in EconPapers)
JEL-codes: F10 F14 F22 R10 (search for similar items in EconPapers)
Pages: 44 p.
Date: 2013-02-20
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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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 (2012)
Working Paper: On the Pro-Trade Effects of Immigrants (2012)
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