"Immigration and Gender Differences in the Labor Market,"Journal of Human Capital, 15(1), forthcoming Spring 2021, Special Issue on "New Ideas on the Economic Consequences of Immigration."
Working paper version [pdf].
A post on this article appeared in the Barcelona GSE Focus blog.
This paper analyzes the effect of immigration on gender gaps in the labor market. Using an equilibrium structural model for the U.S. economy, I simulate the importance of two mechanisms: the differential labor market competition induced by immigration on male and female workers, and the availability of cheaper child care services. Consistent with the literature, aggregate effects on gender and participation gaps are negligible. However, female are more negatively affected by labor market competition, even though these effects are compensated from the cheaper-childcare effect. This generates heterogeneity in the effects along the skill distribution: gender gaps are increased at the bottom of the distribution and reduced at the top. Human capital adjustments are also heterogeneous.
"The economics of migration: Labour market impacts and migration policies," with Francesco Fasani and Cristina Tealdi,
Labour Economics, Introduction to the Special Issue on "The Economics of Migration", 67, December 2020, 101929.
This article introduces the Special Issue on "The Economics of Migration: Labour Market Impacts and Migration Policies". In the paper, we summarize the selection of articles published in the Special Issue and place their contributions in the context of the main developments in this field. We have organized the articles into three broad thematic areas. The first set of papers provides novel evidence on migrant selection. The following group of articles delves in the core literature of labour market impacts of immigration, with a particular focus on high-skilled immigration and selective immigration policies. A final group of papers deals with more specific –and often controversial– topics: refugee migration, undocumented migration and the political consequences of migration flows. In the concluding remarks, we extract from the different papers some guidance for future migration policies.
"The Impact of Immigration on Productivity,"
in Eugenia Vella, Jordi Caballé, and Joan Llull (eds.) Understanding Migration with Macroeconomics, Cham: Palgrave Macmillan, Chapter 2, pp. 21–58, 2020.
DOI: 10.1007/978-3-030-40981-4_2. ISBN: 978-3-030-40980-7.
Also circulated under the title "Reconciling Spatial Correlations and Factor Proportions: A Cross-Country Analysis of the Economic Consequences of Immigration".
This paper presents a cross-country analysis of the impact of immigration on productivity and employment. Push-distance interactions provide relevant and exogenous variation for identification. Results suggest that a one percentage point increase in the share of immigrants in the population reduces GDP per capita by 2%, the employment rate by 0.89 percentage points, and average hours worked conditional on working by 1.28%, whereas it increases the unemployment rate by 0.55 percentage points. Back-of-the-envelope calculations based on a simple production framework provide a structural interpretation. Estimates imply a semi-elasticity of native wages to immigration of -0.7 if the extensive margin of labour supply is ignored (the zeroes of displaced workers are averaged in), and +0.12 on the wages of those who remain working. The effect on immigrant wages is unambiguously negative.
"Immigration, Wages, and Education: A Labor Market Equilibrium Structural Model,"Review of Economic Studies, 85(3), 1852–1896, July 2018.
Online suplement [pdf].
Code and data [zip].
Recent literature analysing wage effects of immigration assumes labour supply is fixed across education-experience cells.
This article departs from this assumption estimating a labour market equilibrium dynamic discrete choice model on U.S.
micro-data for 1967–2007. Individuals adjust to immigration by changing education, participation, and/or occupation.
Adjustments are heterogeneous: 4.2–26.2% of prime-aged native males change their careers; of them, some switch to
white-collar careers and increase education by about three years; others reduce labour market attachment and reduce education
also by about three years. These adjustments mitigate initial effects on wages and inequality. Natives that are more similar
to immigrants are the most affected on impact, but also have a larger margin to adjust and differentiate. Adjustments also
produce a self-selection bias in the estimation of wage effects at the lower tail of the distribution, which the model corrects.
I estimate the effect of immigration on wages of native male workers correcting for endogenous allocation of immigrants
across education-experience cells. Exogenous variation is obtained from interactions of push factors, distance, and
skill-cell dummies: distance mitigates the effect of push factors more severely for some skill groups. I propose a
two-stage approach (Sub-Sample 2SLS) that estimates the first stage regression with an augmented sample of destination
countries, and the second stage with a restricted sub-sample of interest. Asymptotic properties are discussed. Results
show important OLS biases. For U.S. and Canada, Sub-Sample 2SLS elasticities average around minus one, very stable across
alternative specifications and different instruments.
Using data from the Panel Study of Income Dynamics (PSID) and the Medical Expenditure Panel Survey (MEPS), we analyze the
health gap between married and unmarried individuals of working-age. Controlling for observables, we find a gap that peaks
at 10 percentage points at ages 55-59. If we allow for unobserved heterogeneity in innate health (permanent and age-dependent),
potentially correlated with timing and likelihood of marriage, we find that the effect of marriage on health disappears below
age 40, while about 5 percentage points difference between married and unmarried individuals remains at older (55–59) ages.
This indicates that the observed gap is mainly driven by selection into marriage at younger ages, but there might be a protective
effect of marriage at older ages. Exploring the mechanisms behind this result, we find that better innate health is associated
with a higher probability of marriage and a lower probability of divorce, and there is strong assortative mating among couples
by innate health. We also find that married individuals are more likely to have a healthier behavior compared to unmarried ones.
Finally, we find that health insurance is critical for the beneficial effect of marriage.
In this paper I present a new database of bilateral migrant stocks and I provide new evidence on the determinants of
international migration. The new Census-based data are obtained from National Statistical Offices of 24 OECD countries,
and they cover the total stock of immigrants in each destination country for 1960–2000, including 188 countries of origin,
sometimes in grouped categories. For each census, I keep grouped categories in a raw manner, without making imputations
to specific origin countries. In the empirical analysis, I give an explicit treatment to these grouped categories.
Results present strong evidence of heterogeneous effects of income gains on migration prospects depending on distance.
For example, a 1000$ increase in US income per capita increases the stock of Mexican immigrants in the country by a
percentage 2.6 times larger than the percentage increase in the stock of Chinese (8 vs. 3.1%).
"Labor Market Competition and the Assimilation of Immigrants," with Christoph Albert and Albrecht Glitz
Work in progress.
PDF version [pdf].
The wage gap between newly arriving immigrants and comparable natives in the US has widened substantially over the last few decades while the subsequent speed of convergence has declined. These patterns have led to a pessimistic view regarding wage assimilation prospects of immigrants. This paper unravels an unexplored mechanism that can explain an important part of these regularities: labor market competition. Because natives and immigrants are imperfect substitutes in production, increasing immigrant inflows exert stronger labor market competition on previous cohorts of immigrants than on natives, contributing to a widening wage gap. We quantify the importance of this mechanism by using a simple model that accounts for the main features of the literatures on the wage impact of immigration and wage assimilation. Our results suggest that, if competition and composition effects are netted out, immigrant cohorts are more positively selected in recent decades, and that these differences are wiped out after 10 years, implying a lower relative wage growth for recent cohorts.
"Selective Immigration Policies and the U.S. Labor Market"
Work in progress.
PDF version [pdf].
While immigration of unskilled workers often generates controversy in the political arena, there is often more consensus
in favor of selective immigration policies. This paper studies the effects of selective immigration policies on the labor
market. High skilled immigration introduces two potentially confronting forces on labor market prospects of native workers:
first, it increases the competition for skilled jobs, reducing labor market opportunities, and, as a result, reducing native
incentives to invest in human capital; second, it increases productivity through spillovers and technological progress. I
pose and estimate a labor market equilibrium dynamic discrete choice model that can account for these effects. The estimated
model is used to evaluate the labor market consequences of the two most important skill-biased immigration policies in recent
U.S. history: the introduction of H-1B visa program in 1990, and the elimination of the National Origins Formula in 1965.
Finally, I use the model to predict the level of selectivity of immigration policy that maximizes native workers' wellbeing.
"Internal Migration and Work Experience in Dual Labor Markets," with Robert A. Miller
Work in progress.
PDF version [pdf].
This paper uses a large panel assembled from Spanish administrative data for over one million individuals assembled from tax,
welfare and employment records over a period spanning 30 years to estimate a dynamic model of individual optimization that
explains transitions and spell lengths between permanent positions, temporary positions, unemployment and exits from the
workforce. We seek to explain the sequence of job spells in temporary contracts and unemployment transitions as new entrants
in the workforce gradually acquire experience and, ultimately, transition into permanent contracts. The career mobility of
young workers is jointly determined with geographical and occupational mobility. Thus we investigate how different types of
labor market experience and welfare entitlements affect job search behavior, employment duration, and migration patterns over
the life cycle.
"Expectations, Satisfaction, and Utility from Experience Goods: A Field Experiment in Theaters,"
with Pedro Rey-Biel, Ayelet Gneezy, Uri Gneezy, and Dominique Lauga
Barcelona GSE Working Paper 944, February 2020.
PDF version [pdf].
A post on this article appeared in the
Barcelona GSE Focus blog.
Understanding what affects consumption satisfaction is fundamental to understanding consumer behavior. Measuring satisfaction, however, is not trivial, especially in the context of experience goods where perceived quality is often subjective and unobservable prior to consumption. We report the results of a field study (N=433) conducted in collaboration with a theater that uses pay-what-you-want pricing, inviting the audience to pay at the end of the show. We find that survey measures of post-consumption enjoyment capture only part of consumer satisfaction. This occurs because individuals with a larger positive gap between self-reported expected and actual enjoyment pay significantly more. Our analyses further indicate that neither expected nor realized enjoyment predict payments once we control for the expectation-realization gap. The paper highlights the managerial implications of these findings.
Old research papers
"Skilled migration and growth. Testing brain drain and brain gain theories," with José L. Groizard,
DEA Working Papers 20, Universitat de les Illes Balears, October 2007.
PDF version [pdf].
Previously circulated under the title "Brain Drain or Brain Gain? New Empirical Evidence".
Traditional models of brain drain stress its negative impact on the welfare and growth of sending economies, while new
models introduce the possibility of brain gain through several channels (human capital, remittances, return migration
or FDI and trade linkages). We test all these theories by estimating cross-country individual regressions for each channel,
and a system of equations to assess the overall effect of brain drain on economic growth. Results suggest a negative effect
on human capital stock, negligible on remittances (controlling for total migration) and a positive effect on trade and FDI.
The net impact of skilled migration on economic growth remains ambiguous.