Immigration and the Economy of Cities and Regions

86 Pages Posted: 3 Sep 2014

See all articles by Ethan G. Lewis

Ethan G. Lewis

Dartmouth College - Department of Economics

Giovanni Peri

University of California, Davis - Department of Economics

Date Written: August 2014

Abstract

In this chapter we analyze immigration and its effect on urban and regional economies focusing on productivity and labor markets. While immigration policies are typically national, the effects of international migrants are often more easily identified on local economies. The reason is that their settlements are significantly concentrated across cities and regions, relative to natives. Immigrants are different from natives in several economically relevant skills. Their impact on the local economy depends on these skills. We emphasize that to evaluate correctly such impact we also need to understand and measure the local adjustments produced by the immigrant flow. Workers and firms take advantage of the opportunities brought by immigrants and respond to them trying to maximize their welfare. We present a common conceptual frame to organize our analysis of the local effects of immigration and we describe several applications. We then discuss the empirical literature that has tried to isolate and identify a causal impact of immigrants on the local economies and to estimate the different margins of response and the resulting outcomes for natives of different skill types. We finally survey promising recent avenues for advancing this research.

Suggested Citation

Lewis, Ethan G. and Peri, Giovanni, Immigration and the Economy of Cities and Regions (August 2014). NBER Working Paper No. w20428. Available at SSRN: https://ssrn.com/abstract=2490838

Ethan G. Lewis (Contact Author)

Dartmouth College - Department of Economics ( email )

Hanover, NH 03755
United States

Giovanni Peri

University of California, Davis - Department of Economics ( email )

One Shields Drive
Davis, CA 95616-8578
United States
530-752-3033 (Phone)
530-752-9382 (Fax)

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