OPENING THE FLOODGATES: PARTIAL AND GENERAL EQUILIBRIUM ADJUSTMENTS TO LABOR IMMIGRATION
Link to article:
Authors:
Bernt Bratsberg, Andreas Moxnes, Oddbjørn Raaum, Karen Helene Ulltveit-Moe
Year:
2023
Reference:
Vol 64(1), 3-21Summary
We investigate the impact of a large immigration shock on occupational wages. We develop a general equilibrium model where individuals sort into occupations and confront testable hypotheses with data. To identify the effect of the labor supply shock, we introduce a novel instrument that exploits that immigrants systematically sort into different occupations than natives. We study the immigration wave to Norway after the Eastern enlargement and find that immigration led to lower relative occupational wages. A quantification of the general equilibrium shows welfare effects of immigration close to zero for natives, but negative effects for the pre-existing population of immigrants.
Project:
Oppdragsgiver: NFR via ESOPOppdragsgivers prosjektnr.: 227072
Frisch prosjekt: 1182 - European Strains
