Working Paper: CEPR ID: DP6797
Authors: Martin Kahanec; Klaus F. Zimmermann
Abstract: While the allocative efficiency of mobility is typically considered to be positive but small in the long run, the induced changes in equality may be considerable in size. In practice, however, migrants typically improve their income position in comparison to those at home, stimulate the economic situation of the sending countries through remittances and rise the economic performance of natives and of capital in the host country through complementarities. The chapter suggests that at least skilled immigration promotes economic equality in the host country under standard conditions. The context is empirically documented und theoretically explained in a core model. Also, immigrant assimilation and selection is discussed, as is the role of ethnicity and ethnic identity for relative economic performance.
Keywords: assimilation; ethnicity; ethnosizing; gini coefficient; income distribution; inequality; integration; migration; minority
JEL Codes: D33; D63; E25; F22; F24; J15; J16; O15
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| skilled immigration (J61) | economic equality (D63) |
| economic equality (D63) | Gini coefficient (D31) |
| immigrants improve income position (J69) | economic situation of sending countries (F24) |
| immigrants raise economic performance of natives (K37) | economic performance of natives (J15) |
| ethnic identity influences economic performance (J15) | immigration and inequality (K37) |