Working Paper: CEPR ID: DP1346
Authors: Josef Zweimuller; Rudolf Winterebmer
Abstract: In this paper we look at the effects of immigration and trade with Eastern Europe on unemployment in Austria. Using individual data over the period 1989-92 of male blue-collar workers employed in the Austrian manufacturing sector, we decompose possible detrimental impacts in unemployment entry effects and unemployment duration effects. We find that unemployment entry does not seem to be strongly affected by the recent increase in the flow of immigrants. This is different from the immigration effect on unemployment duration. Within almost all subgroups there is a significant increase in the length of unemployment spells as a result of increased immigration. Increased trade with Central and East European Countries (CEECs) seems to have increased the risk of unemployment entry, and to a lesser extent also the duration of unemployment. This is different from trade with the rest of the world, where export increases have an unemployment reducing effect.
Keywords: trade; immigration; labour market; unemployment
JEL Codes: F14; J61; J64
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Trade with CEECs increase (F19) | Unemployment entry increase (J64) |
| ROW exports increase (R50) | Unemployment entry decrease (J64) |
| Immigrant share increase (J11) | Unemployment duration increase (J64) |
| ROW exports increase (R50) | Unemployment duration decrease (J64) |