Working Paper: NBER ID: w30904
Authors: David Autor; David Dorn; Gordon H. Hanson
Abstract: Previous research finds that the greater geographic mobility of foreign than native-born workers following economic shocks helps to facilitate local labor market adjustment to shifting regional economic conditions. We examine the role that immigration may have played in enabling U.S. commuting zones to respond to manufacturing job loss caused by import competition from China. Although population headcounts of the foreign-born fell by more than those of the native-born in regions exposed to the China trade shock, the overall contribution of immigration to labor market adjustment in this episode was small. Because most U.S. immigrants arrived in the country after manufacturing regions were already mature, few took up jobs in industries that would later see increased import penetration from China. The foreign-born share of the working-age population in regions with high trade exposure was only three-fifths that in regions with low exposure. Immigration thus appears more likely to aid adjustment to cyclical shocks, in which job loss occurs in regions that had recent booms in hiring, rather than facilitating adjustment to secular regional decline, in which hiring booms occurred in the more distant past.
Keywords: immigration; labor market adjustment; China trade shock; foreign-born mobility; native-born mobility
JEL Codes: E24; F14; F16; J23; J31; L60; O47; R12; R23
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| immigration (F22) | labor market adjustments (J48) |
| China trade shock (F14) | net reductions in foreign-born population (J11) |
| foreign-born population (J11) | labor market adjustments (J48) |
| foreign-born population in high-exposure areas (J11) | net out-migration (F22) |
| foreign-born population in low trade exposure regions (J69) | labor market adjustments (J48) |