The impact of immigration on the well-being of natives

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E S ABSTRACTThe Impact of Immigration on the Well-Being of Natives * 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' wellbeing. 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.JEL Classification: C90, J61, D63

Ethnic diversity and well-being

“…The asterisks in the last column indicate whether the 1998 and 2012 averages are statistically different from each other at the 0.01 significance level. The overall level of SWB is about 7, in line with previous studies using the same dataset (e.g., Ferrer-i Carbonell, 2005, Akay et al, 2014. We also observe changes in reported well-being over time.…”

“…The positive estimates suggest that ethnic diversity is associated with welfare gains for Germans. This result complements the finding of Akay et al (2014), who discovered a positive effect of the immigrant share in the region on the well-being of natives. We confirm the existence of such positive relationship also in our sample, which contains more years, and even after introducing ethnic diversity in the regression.…”

“…2 Our analysis complements the evidence of Akay et al (2014), who discover a positive effect of the immigrant share in the region on the well-being of natives. Since migration is a complex phenomenon and can affect domains beyond those usually researched -e.g., labor market outcomes -our approach allows us to provide insight on how both the size and the composition of migration affect overall Germans' utility.…”

“…GSOEP is a dataset widely used in the SWB literature (e.g., Winkelmann and Winkelmann, 1998, van Praag et al, 2003, Ferrer-i Carbonell, 2005, Akay et al, 2016, as well as in the migration literature (e.g., Constant and Massey, 2003, Jaeger et al, 2010, Akay et al, 2014. The data collection of GSOEP started in 1984 in West Germany, with a sample size of more than 25,000 individuals.…”

Do immigrants improve the health of native workers?

“…A number of recent studies suggest that this adjustment process may improve the job quality of native workers and have non-negligible effects on individual health and well-being [4], [5]. There is also evidence that immigration pushes native workers toward more communication-intensive jobs and reduces the physical burden associated with certain occupations ( Figure 1; Figure 2) [1], [2], [3], [4].…”