Aug 6, 2013

Immigrants Equilibrate Local Labor Markets

This paper has demonstrated that low-skilled Mexican-born workers’ location choices responded very strongly to the geographic variation in labor demand generated by the Great Recession. This behavior is in sharp contrast to low-skilled native-born workers who show little response, and their elasticity even exceeds that of highly skilled natives. Further, the reallocation of Mexican immigrants reduced the variation in employment outcomes for natives living in cities with substantial Mexican-born share. This novel finding represents economically significant behavior, and it is quite robust to a number of alternative interpre- tations.
That is from the conclusions of a new paper by Cadena & Kovak (August 2013). Something I find interesting is how difficult it is to get a visa (not even a working visa) for say a Nigerian or Indian to travel to Guatemala. In other words, some governments of developing countries would like to see more open borders and better treatment to immigrants in the US and Europe when they themselves make things very difficult for immigrants from other developing countries. 

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