Immigration, education and native wage inequality

Christian Lumpe and Benjamin Weigert

No 01/2010, Working Papers from German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung

Abstract: In this paper we analyse the effect of immigration on the labour market prospects for different skill groups among natives. We develop a model of endogenous labour supply in which immigration affects educational decisions of natives. We argue that the distributional consequences of immigration with respect to native between-skill-group inequality are ambiguous in general and crucially depend on the host country's level of educational attainment. We show that this result is robust irrespective of labour market institutions as, e.g., with a rigid wage regime featuring unemployment. Additionally, the model is applied to assess the impact on within-skill-group wage inequality.

JEL-codes: F22 J31 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:svrwwp:012010

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