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Recent papers have found that often immigrants are overqualified relative to native-born workers when comparing an individual’s education to the ‘average’ education in their occupation. We show that these results are sensitive to differences in the education distribution between immigrants and the native born. Using data for New Zealand, which has an immigration policy that favours skilled immigrants, we find that this approach leads one to conclude that immigrants are, on average, overqualified for their occupation. However, once we account for the fact that immigrants are on average more skilled than natives, we find that immigrants are, in fact, less overeducated than natives. JEL classification: F22, J21, J61

This paper brings new evidence to the existing literature on earnings differentials and returns to human capital for immigrants and natives. It is the first paper analysing this topic using data drawn from the Italian Labour Force Survey, a large nationally representative dataset. We show that returns to human capital are considerably lower for immigrants as compared to natives and that there is no return to pre-immigration work experience, suggesting imperfect transferability of human capital. In the second part of the paper we explore models of occupational attainment among immigrants and the native born. Our findings suggest that, contrary to what is observed for natives, immigrants’ human capital does not contribute to getting access to high-paying occupations.JEL classificationJ31, J24, J61, F22

The theory of factor demand has important implications for the study of the impact of immigration on wages. This paper derives the theoretical implications in the context of a general equilibrium model where the wage impact depends on the elasticity of product demand, the rate at which the consumer base expands as immigrants enter the receiving country, the elasticity of supply of capital, and the elasticity of substitution among inputs of production. The constraints imposed by the theory can be used to check the plausibility of the many contradictory claims that appear throughout the immigration literature. JEL codes J23; J61; F22

An important question for firms and policy makers is whether the recruitment of foreign workers can boost innovation. Migration studies have demonstrated positive economic impacts of cultural diversity on productivity and innovation at the regional level, but the impacts at firm level are less well known. Merging data from four different sources, provided by Statistics Netherlands, we construct and analyze a unique linked employer-employee micro dataset of 4582 firms that includes qualitative information on firm innovation. We consider both the number of immigrants these firms employ and their cultural diversity. Potential endogeneity of migrant employment is addressed by an instrumental variables approach that accounts for the past geographic distribution of immigrants and the past culinary diversity of the municipality the firm is located in. We find robust evidence that firms employing relatively more migrants are less innovative. However, there is evidence of integration in that this effect is generally less strong or even absent for second generation immigrants. Moreover, firms employing a more diverse foreign workforce are more innovative, particularly in terms of product innovations. The benefits of diversity for innovation are more apparent in sectors employing relatively more skilled immigrants. JEL codes D22, F22, O31

Migration is often viewed as an investment decision. Temporary migrants can be expected to invest less in accumulating human capital specific to the host country. Instead, they work more hours in order to accumulate savings and invest in financial capital that can be transferred back to their country of origin upon return. In this paper, using German panel data, we explore how temporary migrants differ from permanent migrants in their labor supply decisions and behavior. After correcting for endogeneity bias, male temporary migrants are found to work more hours than permanent ones. The effect for females is statistically insignificant. Jel codes J22, J61, F22

We examine two impacts of international emigration on the evolution of the institutions in the origin countries. The first impact concerns the influence of emigration per se (i.e. people who left the country can voice more or less from abroad). The second impact relates to the transfer of the norms of the host country to the home country. The existence of both impacts is confirmed using different indicators of institutional quality. The effects appear stronger when skilled emigration is considered. The main conclusions are robust to alternative econometric methods and to the use of subsamples involving developing countries only. JEL codes: F22, J24, J61, J64., SCOPUS: ar.j, info:eu-repo/semantics/published

A heightened interest in understanding the remitting practices of immigrants and their impact on a variety of economic indicators has emerged as remittances to developing countries have risen substantially over the past decade. If remittances primarily enhance consumption, they may have no lasting impact on economic growth. However, through asset accumulation and human capital investment, remittances may serve as a vehicle for growth. In this paper, we use the 2010 Nepal Living Standards Survey III (NLSS III) to examine how remittances affect household expenditures on human capital investment. Overall, our findings suggest that at the margin, remittances do contribute to human capital investment, but this effect varies substantially by school quality within Nepal. In addition, our results indicate that internal remittances (remittances from household members migrating internally) have a greater impact on education than do external remittances. We posit that this may be due to a higher value placed on Nepali education by internal migrants as compared to the education needed for foreign job opportunities by migrants abroad. JEL codes: J61, I25, F22, F24, H52, O15

By examining the preferences over migration destinations of those revealing a desire to permanently leave their country, this paper provides new evidence on the relevance of subjective measures for cross country comparisons. While hard statistics such as GDP per capita and unemployment rates are commonly used to measure a country’s success, this analysis reveals that people’s preferences over alternative migration destinations are better explained by average levels of life satisfaction in the destination country. Aggregated measures of subjective well-being are, therefore, useful for international comparisons as they better reflect what makes some countries more attractive than others. JEL: F22; I30

After the introduction of the freedom of movement for Eastern European workers, EU-15 countries were expected to reduce public benefits in order to avoid becoming “welfare magnets”. However, OECD data do not support the prediction of a race to the bottom in benefit levels. Using EU-LFS data, I analyze the determinants of migration flows and do not find evidence that welfare state variables affect migration flows when controlling for temporary political restrictions of the freedom of movement. This explains why the pressure to modify welfare spending is small. Furthermore, evidence is found that the restrictions offset the migration incentive effects of work-related pull factors.

Do more risk loving migrants opt for self-employment? We use a novel vignette-adjusted measure of risk preferences to investigate the link between risk aversion and entrepreneurship in migrant communities. Using an original representative household survey of the migrant population in the Greater Dublin Area, we find a significant negative relationship between risk aversion and entrepreneurship. Our results show that the use of vignettes improves the significance of the results, as they simultaneously correct for differential item functioning (where respondents interpret the self-evaluation scale in different ways) between entrepreneurs and non-entrepreneurs, and correct for variation in the use of self-evaluation scales between migrants from different countries of origin. This finding may help explaining the variability in results on the correlation between risk preferences and entrepreneurship reported in previous studies. JEL: F22; J01; J15; J61; L26

Abstract This paper investigates to what extent international migration can be explained by climatic variations. A gravity model of migration augmented with average temperature and precipitation in the country of origin is estimated using a panel data set of 142 sending countries for the period 1995 to 2006. We find two primary results. First, temperature is positively correlated with migration. Second, stronger changes in precipitation are also associated with aligned, but small changes in migration. Both effects are robust to various model modifications. Furthermore, we present initial explorations into the channels relating climate changes with migration via agriculture and internal conflict. JEL Codes F22, Q54

We use Moroccan data to study the determinants of international migrants’ remittances, testing the altruistic and welfare hypotheses. In particular, we analyze and assess what motivates migrants to send remittances back home. Our results lend support to the altruistic hypothesis suggesting that remittances are sent to households with low levels of welfare. Furthermore, the decision to remit is intensely associated to individual characteristics such as migrant income, gender and age. Likewise, remittances may be viewed as loan repayment if the migration costs were borne by the remittance-receiving family.JEL classificationF22, J61, D1, D91, O55.

Abstract This paper first develops a structural micro-founded model of aggregate net migration flow using matching ideas to study how migrants choose between multiple locations using multiple criteria. Migration should reduce inequality in the criteria. Most migration models either do not handle multiple criteria and locations or lack micro foundation. The model predicts that migration flows will be out of all but the top two ranked regions. The empirical work, which uses 1990–1999 Guangdong annual data, confirms this proposition and finds a high degree of common marginal effects of the criteria among 18 locations but also finds increasing regional inequalities. JEL F22 J61 O15

The quality dimension of immigrant human capital has received little attention in the economic assimilation literature. The objective of this paper is to demonstrate how human capital acquired in different source countries may be adjusted according to its quality in the Canadian labor market. This is achieved by deriving quality-adjustment indices using data from the 2001 Canadian census. These indices are then used to examine the role of schooling quality in explaining differential returns to schooling and over-education rates by country-of-origin. The key finding is that accounting for schooling quality virtually eliminates native-immigrant gaps in returns to schooling and the incidence of over-education. The quality of human capital is important for understanding the economic integration of immigrants. JEL Codes F22; I2; J15; J31

This paper analyzes the self-selection patterns among Mexican return migrants during the period from 1990 to 2010. Using census data, we can identify return migrants who have lived in the United States within the previous 5 years but who currently live in Mexico. To calculate the selection patterns, we non parametrically estimate the counterfactual wages that the return migrants would have experienced had they never migrated by using the wage structure of non migrants. We find evidence that the selection patterns change over time toward negative selection. For example, in 1990, the wages that the male return migrants would have experienced had they not migrated was 6 percent larger than the wages of male non migrants. However, by 2010, the difference had declined to -14 percent. The increasing negativity of the degree of selection is robust to the analysis of specific subgroups: rural and urban, men and women, and states with high migration rates and low migration rates. Moreover, the negative selection results for the period from 2000 to 2010 are robust to the use of different surveys that define a return migrant by using distinct characteristics. Additionally, we observe that the wages of return migrants are larger than those that the migrants would have obtained had they not migrated. This finding shows that migration has a positive effect on the Mexican economy.

Mobile workers involve flows of labor and human capital and contribute to a moreefficient allocation of resources. However, migration also changes relative wages,alters the distribution of skills and affects equality in the receiving society. Thepaper suggests that skilled immigration promotes economic equality in advancedeconomies under standard conditions. This is discussed and theoretically derived in acore model, and empirically supported using unique data from the WIID database andOECD. JEL codes D33; E25; F22; J15; J61; O15

Recent evidence suggests that aid induces migration. This result is nevertheless not very informative from a policy perspective since what counts in terms of welfare consequences is the composition of migration. In this paper we focus on education and study which of skilled or unskilled migration is more sensitive to aid. More specifically we investigate the possible channels through which aid might affect self-selection among international emigrants and find that aid induces positive selection by easing the movement of highly qualified workers. Interestingly, we find that technical cooperation and bilateral aid have a significant influence on skilled migration but do not seem to affect unskilled migration significantly. On the other hand, aid targeted to development enhancement affects both categories but seems to have a larger effect on the former. JEL codes: F35, F22, C23, SCOPUS: ar.j, info:eu-repo/semantics/published