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N° 2009-23 |
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| October 2009 |
Immigration, Income and Productivity of Host Countries:
a Channel Accounting Approach |
Mariya Aleksynska
Ahmed Tritah |
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| This paper investigates the contribution of immigration to income and productivity of host countries.
Using a dataset constructed from census data and labor force surveys for 20 OECD countries in the
period from 1960 to 2005, we explore the information on age and educational attainment of immigrants
to assess the contribution of immigration to income components: changes in physical capital, human
capital, employment, and total factor productivity. We combine level accounting approach with panel
income regressions, and also account for the endogeneity of migration choices to productivity shocks.
Our main findings are that, overall, higher shares of immigrants over natives have a positive effect on
income and productivity of their host countries. Under the assumption that older immigrants are also the
ones with the longest duration of stay, this effect is due to the long run changes in TFP, and is robust
to educational disparities between immigrants and natives. The decomposition by age and education
suggests that only unskilled immigrants have a non-neutral impact on income and productivity, which is
negative in the short run but positive, and larger in magnitude, in the long run. We also find a dispersed
impact of the presence of other immigrant groups on some income channels. |
Non-technical summary  |
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Résumé
non-technique
en français |
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| Full text |
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| International migration; productivity; income; employment; instrumental variable;
channel accounting |
Keywords |
| F22; J24; J31; O31 |
JEL classification |
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