The impact of immigration on competing natives' wages

Abstract

"After the fall of the Berlin Wall on November 9, 1989, and the collapse of the German Democratic Republic, a sudden, unexpected and massive influx of East German migrants hit the entire West German labor market. The context is well suited for investigating whether immigration impacts natives' wages, and how the effects depend on product and labor market conditions. We propose direct measures of potential migration with exogenous variation, compare migrants to natives with similar capabilities, and segment the labor market along pre-determined margins. We find that immigration can have negative effects on the wages of natives. These effects surface when product and labor markets are competitive but not under regulation which restricts the entry of firms and provides workers with a strong influence on firms' decision-making." (Author's abstract, © MIT Press Journals) ((en))

Cite article

Prantl, S. & Spitz-Oener, A. (2020): The impact of immigration on competing natives' wages. Evidence from German reunification. In: The Review of Economics and Statistics, Vol. 102, No. 1, p. 79-97. DOI:10.1162/rest_a_00853