Network Formations Among Immigrants and Natives

34 Pages Posted: 21 Jun 2009

See all articles by Gil S. Epstein

Gil S. Epstein

Bar-Ilan University - Department of Economics; IZA Institute of Labor Economics; University College London - CReAM - Centre for Research and Analysis of Migration

Odelia Heizler-Cohen

Hebrew University of Jerusalem; IZA Institute of Labor Economics

Abstract

In this paper we examine possible network formations among immigrants and natives with endogenous investment. We consider a model of a network formation where the initiator of the link bears its cost while both agents benefit from it. We present the model by considering possible interactions between immigrants and the new society in the host country: assimilation, separation, integration and marginalization. The paper highlights different aspects of immigrants' behavior and their interaction with the members of the host country (society) and their source country (society). We found that when the stock of the immigrants in the host country increases, the immigrants' investment in the middlemen increases and the natives may bear the cost of link formation with the middlemen.

Keywords: network formations, social networks, assimilation and separation

JEL Classification: D85, J15, F22, A14

Suggested Citation

Epstein, Gil S. and Heizler-Cohen, Odelia, Network Formations Among Immigrants and Natives. IZA Discussion Paper No. 4234. Available at SSRN: https://ssrn.com/abstract=1423350

Gil S. Epstein (Contact Author)

Bar-Ilan University - Department of Economics ( email )

Ramat-Gan, 52900
Israel
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HOME PAGE: http://faculty.biu.ac.il/~epsteig/

IZA Institute of Labor Economics ( email )

P.O. Box 7240
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Germany

University College London - CReAM - Centre for Research and Analysis of Migration ( email )

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London, WC1H 0AX
United Kingdom

Odelia Heizler-Cohen

Hebrew University of Jerusalem ( email )

Mount Scopus
Jerusalem, IL Jerusalem 91905
Israel

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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