The Labor Market Impact of Immigration: Job Creation versus Job Competition

2021 ◽  
Vol 13 (1) ◽  
pp. 35-78
Author(s):  
Christoph Albert

This paper studies the labor market effects of both documented and undocumented immigration in a search model featuring nonrandom hiring. As immigrants accept lower wages, they are preferably chosen by firms and therefore have higher job finding rates than natives, consistent with evidence found in US data. Immigration leads to the creation of additional jobs but also raises competition for natives. The dominant effect depends on the fall in wage costs, which is larger for undocumented immigration than it is for legal immigration. The model predicts a dominating job creation effect for the former, reducing natives’ unemployment rate, but not for the latter. (JEL E24, J15, J23, J31, J61, M51)




Author(s):  
Bahar Bayraktar Saglam ◽  
Selin Sayek

In this chapter, the authors construct a model that allows for joint discussion of foreign firm and skill premium in wages, and their evolution upon increased foreign firm activities. They allow for (1) dynamic interaction between the domestic and foreign firms in the labor market, via a two-sided search model, (2) technology differentials between domestic and foreign firms, and (3) varying cost of doing business between domestic and foreign firms. Analytical and numerical results point to the importance of modeling all three features. Both the level and the changes in the relative wages depend on the productivity differential (technology gap) and the job creation costs.



Author(s):  
Murat Tasci ◽  
Saeed Zaman

The past recession has hit the labor market especially hard, and economists are wondering whether some fundamentals of the market have changed because of that blow. Many are suggesting that the natural rate of long-term unemployment— the level of unemployment an economy can’t go below—-has shifted permanently higher. We use a new measure that is based on the rates at which workers are finding and losing jobs and which provides a more accurate assessment of the natural rate. We find that the natural rate of unemployment has indeed shifted higher—but much less so than has been suggested. Surprising trends in both the job-finding and job-separation rates explain much about the current state of the unemployment rate.







2017 ◽  
Vol 18 (1) ◽  
Author(s):  
Sekyu Choi ◽  
Arnau Valladares-Esteban

Abstract In this paper we document that married individuals face a lower unemployment rate than their single counterparts. We refer to this phenomenon as the marriage unemployment gap. Despite dramatic demographic changes in the labor market over the last decades, this gap has been remarkably stable both for men and women. Using a flow-decomposition exercise, we assess which transition probabilities (across labor force states) are behind this phenomenon: For men, the main driver is the higher job losing probabilities faced by single workers. For females, the participation margin also plays a crucial role.



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