Wednesday, June 23, 2010

Rand Report on the Dynamics of Immigration and Wages

Rand Silvia Helena Barcellos has posted her new working paper for RAND on SSRN, The Dynamics of Immigration and Wages. From the abstract:

There is considerable debate in the literature about the effects of immigration on workers' labor market outcomes. This paper presents a new approach to the analysis of the relationship between immigration and wages based on a panel vector autoregression (VAR). The VAR analysis of a panel of US states shows that immigration does not have a significant effect on wages or internal migration. By contrast, wages do affect immigration: a 10 percent increase in wages causes up to a 20 percent increase in immigrant inflow. The effect is strongest for low-skill immigrants while it is small and insignificant for high-skill immigrants.

A valuable contribution to the current immigration debate.


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