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Working papers

"Labor Market Competition and the Assimilation of Immigrants" with Christoph Albert and Albrecht Glitz
Revisions requested, American Economic Review. BSE Working Paper 1280, CReAM Discussion Paper 25/21, IZA Discussion Paper 14641, CESifo Working paper 9231. A blog post on it appeared at the BSE Focus.

  Abstract []

This paper shows that the wage assimilation of immigrants is the result of the intricate interplay between individual skill accumulation and dynamic labor market equilibrium effects. When immigrants and natives are imperfect substitutes, rising immigrant inflows widen the wage gap between them. Using a production function framework in which workers supply both general and host-country-specific skills, we show that this labor market competition channel explains about one fifth of the large increase in the average immigrant-native wage gap across arrival cohorts in the United States since the 1960s. This figure increases to one third after also accounting for relative demand shifts due to technological change

"Selective Immigration Policies and the U.S. Labor Market"

  Abstract []

While immigration of unskilled workers often generates controversy in the political arena, there is often more consensus in favor of selective immigration policies. This paper studies the effects of selective immigration policies on the labor market. High skilled immigration introduces two potentially confronting forces on labor market prospects of native workers: first, it increases the competition for skilled jobs, reducing labor market opportunities, and, as a result, reducing native incentives to invest in human capital; second, it increases productivity through spillovers and technological progress. I pose and estimate a labor market equilibrium dynamic discrete choice model that can account for these effects. The estimated model is used to evaluate the labor market consequences of the two most important skill-biased immigration policies in recent U.S. history: the introduction of H-1B visa program in 1990, and the elimination of the National Origins Formula in 1965. Finally, I use the model to predict the level of selectivity of immigration policy that maximizes native workers' wellbeing.

"Internal Migration and Work Experience in Dual Labor Markets" with Robert A. Miller.

  Abstract []

This paper uses a large panel assembled from Spanish administrative data for over one million individuals assembled from tax, welfare and employment records over a period spanning 30 years to estimate a dynamic model of individual optimization that explains transitions and spell lengths between permanent positions, temporary positions, unemployment and exits from the workforce. We seek to explain the sequence of job spells in temporary contracts and unemployment transitions as new entrants in the workforce gradually acquire experience and, ultimately, transition into permanent contracts. The career mobility of young workers is jointly determined with geographical and occupational mobility. Thus we investigate how different types of labor market experience and welfare entitlements affect job search behavior, employment duration, and migration patterns over the life cycle.

"Expectations, Satisfaction, and Utility from Experience Goods: A Field Experiment in Theaters," with Pedro Rey-Biel, Ayelet Gneezy, Uri Gneezy, and Dominique Lauga. BSE Working Paper 944. A post on it appeared at the BSE Focus.

  Abstract []

Understanding what affects consumption satisfaction is fundamental to understanding consumer behavior. Measuring satisfaction, however, is not trivial, especially in the context of experience goods where perceived quality is often subjective and unobservable prior to consumption. We report the results of a field study (N=433) conducted in collaboration with a theater that uses pay-what-you-want pricing, inviting the audience to pay at the end of the show. We find that survey measures of post-consumption enjoyment capture only part of consumer satisfaction. This occurs because individuals with a larger positive gap between self-reported expected and actual enjoyment pay significantly more. Our analyses further indicate that neither expected nor realized enjoyment predict payments once we control for the expectation-realization gap. The paper highlights the managerial implications of these findings.


Published papers

"Immigration and Gender Differences in the Labor Market" Journal of Human Capital, 15(1), 174–203, Spring 2021, Special Issue "New Ideas on the Economic Consequences of Immigration." A post on it appeared at the BSE Focus.

  Abstract []

This paper analyzes the effect of immigration on gender gaps in the labor market. Using an equilibrium structural model for the U.S. economy, I simulate the importance of two mechanisms: the differential labor market competition induced by immigration on male and female workers, and the availability of cheaper child care services. Consistent with the literature, aggregate effects on gender and participation gaps are negligible. However, female are more negatively affected by labor market competition, even though these effects are compensated from the cheaper-childcare effect. This generates heterogeneity in the effects along the skill distribution: gender gaps are increased at the bottom of the distribution and reduced at the top. Human capital adjustments are also heterogeneous.

"The Global COVID-19 Student Survey: First Wave Results" with David A. Jaeger, Jaime Arellano-Bover, Krzysztof Karbownik, Marta Martínez Matute, John M. Nunley, R. Alan Seals, Jr., Miguel Almunia, Mackenzie Alston, Sascha O. Becker, Pilar Benito, René Böheim, José E. Boscá, Jessica H. Brown, Simon Chang, Deborah A. Cobb-Clark, Shooshan Danagoulian, Sandra Donnally, Marissa Eckrote-Nordland, Lídia Farré, Javier Ferri, Margherita Fort, Jane Cooley Fruewirth, Rebecca Gelding, Allen C. Goodman, Melanie Guldi, Simone Häckl, Janet Hankin, Scott A. Imberman, Joanna Lahey, Hani Mansour, Isaac McFarlin, Jaakko Meriläinen, Tove Mortlund, Martin Nybom, Stephen D. O'Connell, Rupert Sausgruber, Amy Schwartz, Jan Stuhler, Petra Thiemann, Roel van Veldhuizen, Marianne H. Wanamaker, Maria Zhu, Covid Economics: Vetted and Real-Time Papers, 79, 152–217, May 2021.

  Abstract []

University students have been particularly affected by the COVID-19 pandemic. We present results from the first wave of the Global COVID-19 Student Survey, which was administered at 28 universities in the United States, Spain, Australia, Sweden, Austria, Italy, and Mexico between April and October 2020. The survey addresses contemporaneous outcomes and future expectations regarding three fundamental aspects of students' lives in the pandemic: the labor market, education, and health. We document the differential responses of students as a function of their country of residence, parental income, gender, and for the US their race.

"The Economics of Migration: Labour Market Impacts and Migration Policies" with Francesco Fasani and Cristina Tealdi, Labour Economics, Introduction to the Special Issue on "The Economics of Migration", 67, December 2020, 101929.

  Abstract []

This article introduces the Special Issue on "The Economics of Migration: Labour Market Impacts and Migration Policies". In the paper, we summarize the selection of articles published in the Special Issue and place their contributions in the context of the main developments in this field. We have organized the articles into three broad thematic areas. The first set of papers provides novel evidence on migrant selection. The following group of articles delves in the core literature of labour market impacts of immigration, with a particular focus on high-skilled immigration and selective immigration policies. A final group of papers deals with more specific –and often controversial– topics: refugee migration, undocumented migration and the political consequences of migration flows. In the concluding remarks, we extract from the different papers some guidance for future migration policies.

"The Impact of Immigration on Productivity" in Eugenia Vella, Jordi Caballé, and Joan Llull (eds.) Understanding Migration with Macroeconomics, Cham: Palgrave Macmillan, Chapter 2, pp. 21–58, 2020. Also circulated under the title "Reconciling Spatial Correlations and Factor Proportions: A Cross-Country Analysis of the Economic Consequences of Immigration".

  Abstract []

This paper presents a cross-country analysis of the impact of immigration on productivity and employment. Push-distance interactions provide relevant and exogenous variation for identification. Results suggest that a one percentage point increase in the share of immigrants in the population reduces GDP per capita by 2%, the employment rate by 0.89 percentage points, and average hours worked conditional on working by 1.28%, whereas it increases the unemployment rate by 0.55 percentage points. Back-of-the-envelope calculations based on a simple production framework provide a structural interpretation. Estimates imply a semi-elasticity of native wages to immigration of -0.7 if the extensive margin of labour supply is ignored (the zeroes of displaced workers are averaged in), and +0.12 on the wages of those who remain working. The effect on immigrant wages is unambiguously negative.

"Immigration, Wages, and Education: A Labor Market Equilibrium Structural Model" Review of Economic Studies, 85(3), 1852–1896, July 2018. Online appendix and replication package.

  Abstract []

Recent literature analysing wage effects of immigration assumes labour supply is fixed across education-experience cells. This article departs from this assumption estimating a labour market equilibrium dynamic discrete choice model on U.S. micro-data for 1967–2007. Individuals adjust to immigration by changing education, participation, and/or occupation. Adjustments are heterogeneous: 4.2–26.2% of prime-aged native males change their careers; of them, some switch to white-collar careers and increase education by about three years; others reduce labour market attachment and reduce education also by about three years. These adjustments mitigate initial effects on wages and inequality. Natives that are more similar to immigrants are the most affected on impact, but also have a larger margin to adjust and differentiate. Adjustments also produce a self-selection bias in the estimation of wage effects at the lower tail of the distribution, which the model corrects.

"The Effect of Immigration on Wages: Exploiting Exogenous Variation at the National Level" Journal of Human Resources, 53(3), 608–622, Summer 2018. Replication package. A blog post on it appeared at the BSE Focus.

  Abstract []

I estimate the effect of immigration on wages of native male workers correcting for endogenous allocation of immigrants across education-experience cells. Exogenous variation is obtained from interactions of push factors, distance, and skill-cell dummies: distance mitigates the effect of push factors more severely for some skill groups. I propose a two-stage approach (Sub-Sample 2SLS) that estimates the first stage regression with an augmented sample of destination countries, and the second stage with a restricted sub-sample of interest. Asymptotic properties are discussed. Results show important OLS biases. For U.S. and Canada, Sub-Sample 2SLS elasticities average around minus one, very stable across alternative specifications and different instruments.

"Marriage and Health: Selection, Protection, and Assortative Mating" with Nezih Guner and Yuliya A. Kulikova, European Economic Review, 104, 138–166, May 2018 (Reprinted for the Special Issue on "Gender Differences in the Labor Market", European Economic Reivew, 109, 162-190, October 2018). Previously circulated under the title "Does Marriage Make You Healthier?" Replication package. This paper was elected one of the eight finalists of the La Vanguardia Science Award and also received wide media coverage. Blog posts on the article appeared at The Economist, VOXeu, BSE Focus, and Nada es Gratis.

  Abstract []

Using data from the Panel Study of Income Dynamics (PSID) and the Medical Expenditure Panel Survey (MEPS), we analyze the health gap between married and unmarried individuals of working-age. Controlling for observables, we find a gap that peaks at 10 percentage points at ages 55-59. If we allow for unobserved heterogeneity in innate health (permanent and age-dependent), potentially correlated with timing and likelihood of marriage, we find that the effect of marriage on health disappears below age 40, while about 5 percentage points difference between married and unmarried individuals remains at older (55–59) ages. This indicates that the observed gap is mainly driven by selection into marriage at younger ages, but there might be a protective effect of marriage at older ages. Exploring the mechanisms behind this result, we find that better innate health is associated with a higher probability of marriage and a lower probability of divorce, and there is strong assortative mating among couples by innate health. We also find that married individuals are more likely to have a healthier behavior compared to unmarried ones. Finally, we find that health insurance is critical for the beneficial effect of marriage.

"Understanding International Migration: Evidence from a New Dataset of Bilateral Stocks (1960-2000)" SERIEs—Journal of the Spanish Economic Association, 7(2), 221–255, June 2016. Replication package. This paper was the recipient of the 2020 Award to an Outstanding Research Contribution Published in SERIEs—Journal of the Spanish Economic Association in the period 2016–2019.

  Abstract []

In this paper I present a new database of bilateral migrant stocks and I provide new evidence on the determinants of international migration. The new Census-based data are obtained from National Statistical Offices of 24 OECD countries, and they cover the total stock of immigrants in each destination country for 1960–2000, including 188 countries of origin, sometimes in grouped categories. For each census, I keep grouped categories in a raw manner, without making imputations to specific origin countries. In the empirical analysis, I give an explicit treatment to these grouped categories. Results present strong evidence of heterogeneous effects of income gains on migration prospects depending on distance. For example, a 1000$ increase in US income per capita increases the stock of Mexican immigrants in the country by a percentage 2.6 times larger than the percentage increase in the stock of Chinese (8 vs. 3.1%).



"Understanding Migration with Macroeconomics" jointly edited with Eugenia Vella and Jordi Caballé, Cham: Palgrave MacMillan, ISBN: 978-3-030-40980-7, 2020.


Old research papers

"Skilled migration and growth. Testing brain drain and brain gain theories" with José L. Groizard, DEA Working Papers 20, Universitat de les Illes Balears, October 2007. Previously circulated under the title "Brain Drain or Brain Gain? New Empirical Evidence".

  Abstract []

Traditional models of brain drain stress its negative impact on the welfare and growth of sending economies, while new models introduce the possibility of brain gain through several channels (human capital, remittances, return migration or FDI and trade linkages). We test all these theories by estimating cross-country individual regressions for each channel, and a system of equations to assess the overall effect of brain drain on economic growth. Results suggest a negative effect on human capital stock, negligible on remittances (controlling for total migration) and a positive effect on trade and FDI. The net impact of skilled migration on economic growth remains ambiguous.