The Impact of Immigration on the Well-Being of Natives

47 Pages Posted: 16 Jun 2012

See all articles by Alpaslan Akay

Alpaslan Akay

IZA Institute of Labor Economics

Amelie F. Constant

Princeton University; UNU-MERIT; CESifo

Corrado Giulietti

Department of Economics

Abstract

This paper examines the effect of immigration directly on the overall utility of natives. To the best of our knowledge, this is the first paper to explore such nexus. Combining information from the German Socio-Economic Panel dataset with detailed local labour market characteristics for the period 1997 to 2007, we investigate how changes in the spatial concentration of immigrants affect the subjective well-being of the German-born population. Our results suggest the existence of a robust, positive effect of immigration on natives' well-being. The presence of confounding local labour market characteristics has a negligible impact on the estimates. Furthermore, we find substantial evidence that the effect of immigration on well-being is a function of the assimilation of immigrants in the region. The effect of immigration is higher in regions with an intermediate level of economic assimilation and is essentially zero in areas where immigrants are either least or fully economically integrated. We conduct robustness checks to address the potential endogeneity between subjective well-being and immigration. Our tests indicate that natives are not crowded out by immigrants, and that the sorting of immigrants to regions with higher SWB is weak. This suggests that our main findings are not driven or strongly influenced by reverse causality or selectivity.

Keywords: immigration, subjective well-being, assimilation

JEL Classification: C90, J61, D63

Suggested Citation

Akay, Alpaslan and Constant, Amelie F. and Giulietti, Corrado, The Impact of Immigration on the Well-Being of Natives. IZA Discussion Paper No. 6630. Available at SSRN: https://ssrn.com/abstract=2085217

Alpaslan Akay (Contact Author)

IZA Institute of Labor Economics ( email )

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

Amelie F. Constant

Princeton University ( email )

189 Wallace Hall
Princeton, NJ 08544
United States

HOME PAGE: http://opr.princeton.edu/visitors/

UNU-MERIT ( email )

Keizer Karelplein 19
Maastricht, 6211TC
Netherlands

HOME PAGE: http://www.merit.unu.edu/about-us/profile/?staff_id=2419

CESifo ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.cesifo-group.de/ifoHome/research/Network/Members.html

Corrado Giulietti

Department of Economics ( email )

University Rd.
Southampton SO17 1BJ, Hampshire SO17 1LP
United Kingdom

Register to save articles to
your library

Register

Paper statistics

Downloads
33
Abstract Views
340
PlumX Metrics