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The Effect of Immigration on Wages: Exploiting Exogenous Variation at the National Level

The Effect of Immigration on Wages: Exploiting Exogenous Variation at the National Level <p>ABSTRACT:</p><p>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 (Subsample 2SLS) that estimates the first stage regression with an augmented sample of destination countries and the second stage with a restricted subsample of interest. Asymptotic properties are discussed. Results show important OLS biases. For the United States and Canada, Subsample 2SLS elasticities average around minus one, very stable across alternative specifications and different instruments.</p> http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Human Resources University of Wisconsin Press

The Effect of Immigration on Wages: Exploiting Exogenous Variation at the National Level

Journal of Human Resources , Volume 53 (3) – Jul 3, 2018

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Publisher
University of Wisconsin Press
Copyright
©by the Board of Regents of the University of Wisconsin System
ISSN
1548-8004

Abstract

<p>ABSTRACT:</p><p>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 (Subsample 2SLS) that estimates the first stage regression with an augmented sample of destination countries and the second stage with a restricted subsample of interest. Asymptotic properties are discussed. Results show important OLS biases. For the United States and Canada, Subsample 2SLS elasticities average around minus one, very stable across alternative specifications and different instruments.</p>

Journal

Journal of Human ResourcesUniversity of Wisconsin Press

Published: Jul 3, 2018

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