Native wage impacts of foreign labor: a random effects panel analysis

Natives often fear labor market competition of foreigners, as they may induce declining wages and rising unemployment as in the case of natives and immigrants being substitutes. However, there is also the potential that they are complements, producing positive wage and employment effects. This issue is examined in a framework with two types of labor, such that low qualified native and immigrant workers (blue collar), although substitutes for one another, are potentially complements to high qualified native workers (white collar). This is thought to accurately reflect the past West German immigration experience. Examining the wage functions of white and blue collar natives in a random effects panel model using a vast sample of micro data, we actually find that foreigners negatively affect the wages of Germans on the whole. Relatively small gains are made by white collar employees with less than 20 years experience, but these are outweighed by the larger negative effects experienced by blue collar employees.We wish to thank Don DeVoretz, Riccardo Faini, Andrea Ichino, and participants at the following 1993 conferences for their valuable comments where drafts of this paper were presented: The Economics of International Migration: Econometric Evidence at the University of Konstanz, Internationale Migration und Arbeitsmarkt der Schweizerischen Gesellschaft fur Statistik und Volkswirtschaftslehre at the University of St. Gallen, Adjustment Policies in Previously Centrally Planned Economies: Which Lessons from Developing Countries Experiences at the University of Brescia, and Congress of the European Society for Population Economics in Budapest. Substantial revisions were made following the valuable suggestions of two anonymous referees and the special issue editor Wolfgang Franz, for which we are grateful.     

Immigration,Welfare Magnets and the Geography of Child Poverty in the United States

This study presents a detailed look at the immigration and internal migration dynamics of child poverty for US States based on the 1990 US census. It assesses the impact of two policy-relevant factors on the migration of poor children across States: (1) the role of high immigration levels as a potential push for native-born and longer-term resident poor children whose parents may be reacting to the economic competition or social costs in high immigration States; and (2) the role of State AFDC benefits as a potential pull for poor children who migrate with their parents to States with higher benefit levels. The results make plain that the interstate migration patterns of poverty children differ from those of nonpoverty children, especially among whites and blacks. Female-headed households show different inter-state migration patterns than those in married-couple households. However, a multivariate analysis which includes standard state-level economic attributes provides more support for an immigration push than for a welfare magnet pull in affecting the inter-state migration of poor children. The findings also show a demographic displacement of poor children occurring in high immigration States where the net out-migration of poor children is more than compensated by larger numbers of new immigrant children in poor families with different demographic attributes. Because of these migration dynamics, the demographic profile of the child poverty population will differ across States, suggesting the need for different strategies toward reducing child poverty at the State level.     

Labor market effects of immigration in the United States and Europe: substitution vs. complementarity

This paper examines the impact of immigrants on the income of various groups of resident workers in the United States and Europe. Our approach features the use of a production technology incorporating education, experience, and unskilled labor as inputs. This contrasts with the assumption used in earlier studies that native-born and immigrant labor are distinct inputs into production. We find that in both United States and European production, education, unskilled labor and experience are complementary inputs. Based on these results, simulations of the impact of immigration on residents are carried out. The absolute magnitude of these effects is found to be very small.This paper was presented at the Centre for Economic Policy Research Workshop, The Economics of International Migration: Econometric Evidence, February 26 and 27, 1993, Konstanz, Germany. We benefitted from the discussion at the conference and, particularly, the comments of Anton Muscatelli. We thank three referees and the managing editor of this journal for their suggestions. We also thank Selig Sechzer for his significant contributions to the empirical analysis in this paper. Ira Gang's work was partially supported by the Rutgers University Research Council.     

Migradollars: The remittances and savings of Mexican migrants to the USA

In this article, we use new data from 22 communities to estimate the total flow of dollars back into Mexico as a result of migration to the United States. Our estimates include remittances sent while working abroad and money brought back on return trips; they incorporate transfers by temporary as well as permanent US workers; they include money transferred by legal as well as illegal migrants; and they include funds sent or brought by household heads as well as other family members. We estimate that US$ 24 million in migradollars flowed into the sample communities during the survey year. In some places, the flow of US money equalled or exceeded the value of locally earned income. When generalized to all of Western Mexico, our sample suggests a regional flow of US$ 1.5 billion; and when our data are inserted into an estimation model developed earlier by Lozano Ascencio, we estimate the total flow at US$ 2 billion for Mexico as a whole. Although most of this money was spent on consumption, investments in productive activities were significant, and directly or indirectly, we conclude that migradollars play an extremely important role in Mexican economic production.This article is based on a paper, presented at the University of Chicago, 8 October 1993.     

Population in context: A typology of environmental driving forces

This paper presents a typology and qualitative model of causation for use in assessing the relative contributions of population growth to problems of pollution, lost biodiversity, and natural resource depletion. Population growth is placed in context as one of eight key driving forces that shape environmental quality today. It is treated primarily as an impact amplifier, along with technology. Root causes are traced to paradigmatic beliefs—especially anthropocentrism and contempocentrism—which find expression in unsustainable consumption patterns and designs of political economy.     

Three Centuries of Global Population Growth: A Spatial Referenced Population (Density) Database for 1700–2000

The Earths surface has changed considerably over the past centuries. Since the start of the Industrial Revolution in the early 1700s, humans from the Old World started to colonize the New World. The colonization processes lead to major changes in global land use and land cover. Large parts of the original land cover have been altered (e.g., deforestation), leading to extra emissions of GHGs to the atmosphere and enhancing global climate change. The spatial and temporal aspects are still not very well known. More and more global integrated environmental assessments concerning global sustainability require long time series of global change indicators, of which population is an important one. This study presents an update of the geo-referenced historical population maps for the period 1700–2000, part of the History Database of the Global Environment (HYDE), which can be used in integrated models of global change and/or global sustainability.     

Estimates of the number of illegal aliens: An analysis of the sources of disagreement

This article analyzes differences in estimates of the number of illegal aliens in the United States. Although smaller than differences among estimates made by some of the earlier studies, estimates constructed in the past decade often differ by several million. An examination of the problems involved in making these estimates produced four likely sources of the discrepancies. The four sources of disagreement are discussed, followed by suggestions for improving the reliability of the estimates. Some consequences for immigration law reform are also addressed.     

Household fertility responses following communism: Transition in the Czech Republic and Slovakia

In central Europe fertility fell during transition from centrally planned to market oriented economies. Families reevaluated fertility plans facing new wages, reduced child-care subsidies, and economic uncertainty. Using micro-data from 1984 and 1993 in the Czech Republic and Slovakia, this paper relates fertility changes following Communism to wages, pricesand risks. Earnings have little impact on fertility timing during transition, though age, job uncertainty, and children conceived during Communism do. In the Czech Republic, changed fertility demand parameters account for much of thefall in fertility. In Slovakia a sizable proportion results from predictable responses to changed incentives.I would like to thank my Czech collaborators Pavel Mahonn, Petr Mateju, and Jiri Vecernk for enabling this empirical work to proceed; T. Paul Schultz, and Jenny Hunt and seminar participants at Yale University, the NEUDC, and the Population Association of America annual meetings and two anonymous referees for helpful comments. I am also indebted to the Mellon Foundation Area Studies Grant program for financial support allowing field work on this topic. I am wholly responsible for all errors. Responsible editor: T. Paul Schultz.     

Immigrants’ economic performance across Europe – does immigration policy matter?

Drawing on panel data from the European Community Household Panel (ECHP), the British Household Panel Survey (BHPS) and the German Socio-Economic Panel Study (SOEP), we compare the economic performance of immigrants to Great Britain, West Germany, Denmark, Luxembourg, Ireland, Italy, Spain and Austria to that of the respective indigenous population. The unit of analysis is the individual in the household context. This allows us to define immigrants state of integration into the host society at the family level taking into account issues such as immigrant/native intermarriage. Economic performance is measured in terms of the country-specific pre-government income position and change in the relative income position due to redistribution processes within the respective tax and social security systems. Our work is based on the premise that countries may be categorized – similarly to existing categorizations based on the type of welfare regime – according to the nature of their immigration policy. From an economic point of view, a successful and integrative immigration policy should result – at least when controlling for background characteristics such as education – in a non-significant differential between the economic performance of immigrants and that of the indigenous population. At first glance, our results indicate that this ideal is not attained in all of the countries analysed, particularly not in Germany and Denmark, where the economic performance of immigrants is much lower than that of the indigenous population. However, results from GLS random-effects models show that immigrants to these countries improve their economic situation rapidly with increasing duration of stay in the host country. This implies that these countries also do fairly well in fostering in the economic integration of immigrants. Our empirical results further reveal that the substantial cross-country differences in the immigrant/native-born performance differential persist even when controlling in detail for socioeconomic characteristics of the household and for indicators of the state of the immigrants integration, such as years since migration and immigrant/native intermarriage. This suggests that not only the conditions of entry to a country impact on immigrants economic performance, but also country-specific institutional aspects such as restrictions on access to the labour market and parts of the social security system that are related to citizenship or immigrant status. There still is a great deal of heterogeneity across EU member states in this respect. This should be taken into account when working towards the harmonization of national EU immigration policies.This paper benefited substantially from discussions at the EEA 2003 Conference in Stockholm, Sweden, and the EPUNet 2003 Conference in Colchester, UK. We also acknowledge very helpful comments resulting from the reviewing process     

Multiple-Scale Integrated Assessments of Societal Metabolism: Integrating Biophysical and Economic Representations Across Scales

The crucial challenge for integrated analyses of socioeconomic systems is keeping coherence in their multidimensional representation. Our approach describes the hierarchical structure of socioeconomic systems using the profile of allocation of human activity over a set of compartments defined at different hierarchical levels (e.g., whole countries, economic sectors, individual households). Compartments are characterized in terms of intensive variables (intensity of both exosomatic energy flows and added value flows per unit of human activity) and the extensive variable Total Human Activity population. In this way, relations of congruence across hierarchical levels can be used to link non-equivalent analyses. That is, changes in demographic variables, economic variables, technical coefficients, indices of environmental loading, institutional settings, and social aspirations are no longer independent of each-other even if described within different scientific disciplines.     

The Easterlin hypothesis in the recent experience of higher-income OECD countries: A panel-data approach

The Easterlin hypothesis emphasizes the effect of relative cohort size on fertility. Models based on the Easterlin hypothesis have performed well in explaining time series fertility data, although these results have been for long historical time series and have typically been restricted to single country studies. These models are not adequate to determine if the hypothesis still holds and if the success of the Easterlin hypothesis is an artifact of the time period chosen. We use panel data analysis and temporal causality tests to see of the Easterlin hypothesis holds for higher-income OECD countries. The results support the Easterlin hypothesis.All correspondence to Yongil Jeon. An earlier version, The Easterlin hypothesis in OECD countries, was presented at the annual conference of the European society for population economics, Bilbao, Spain, June 2002. We are grateful to two anonymous referees for their helpful comments. The usual caveat applies. Responsible editor: Junsen Zhang.     

Exponential Population Growth and Doubling Times: Are They Dead or Merely Quiescent?

Exponential Growth and Doubling Times: Use of these popular population buzzwords of the last half of the twentieth century was fully justified by the growth rates of that period. However, those growth rates have now all but disappeared and so have the underlying reasons that those buzzwords made sense. Misuse of such expressions today costs credibility. Though the world's population growth certainly does remain vigorous and robust, creating many reasons for concern, nowhere today is growth projected as exponential. The essence of exponential growth is analyzed and distinguished from exponential curves, and non-exponential growth. Several types of current population growth are recognized, none being exponential. In periods of non-exponential growth, a Doubling Time calculated from a single annual growth rate is grossly erroneous and often absurd. Other standard measures of growth are needed. United Nations projections should include figures for percentage growth by 2025 and 2050.     

Multiple-Scale Integrated Analysis of Farming Systems: The Thuong Lo Commune (Vietnamese Uplands) Case Study

This paper presents an application of an innovative methodological tool for the integrated assessment of farming systems (Multi-Objective Multiple-Scale Integrated Representation). It describes the effect of rural development in parallel on economic and ecological reading at different levels: household, village, and the commune comprising 3 villages. Socio-economic and environmental indicators are organized into integrated packages across scales. This is an ex-post facto analysis of a program of rural development implemented in the Central Vietnamese uplands in 1995 by the central government with the collaboration of FAO. We conclude that two classic problems can only be faced by using an integrated analysis across levels: Large scale generalizations can miss important location-specific characteristics, and exclusive focus on location specific issues carries the risk of loosing the big picture.     

Migrant stock vs. lagged migrant flow as a determinant of migrant settlement. A comment on Anjomani and Hariri

In a recent contribution to this Journal Anjomani and Hariri present an interesting study of United States interstate migration which explicitly incorporates so-called flow diversion and flow creation effects. Their discussion and evaluation of the model, however, are marred by several factors. This paper contrasts the roles of migrant stock and lagged migration in migration analysis and then addresses (a) the problems encountered when the family-friends effect is proxied with measures of lagged migrant flows, (b) the problem of using a two-period lagged value of earlier migrant flow as an explanatory variable, and (c) this paper suggests an alternative method of correcting the Anjomani-Hariri model's problems with multicollinearity.The author is grateful to Walter J. Wadycki and to David A. Macpherson for helpful comments and suggestions. The author, of course, bears full responsibility for all errors that remain. This research benefited from a grant from the Miami University Committee on Faculty Research.     

Reflections on sustainability,population growth,and the environment

The related terms, sustainable and sustainability, have become popular and are used to describe a wide variety of activities which are generally ecologically laudable. At the same time, the term compromise is heard more frequently because the needs of the environment often are in conflict with the needs of humans. A brief examination of the question of compromise shows that a series of ten compromises, each of which saves 70% of the remaining environment, results in the saving of only 3% of the environment. Judging from the ways in which the terms sustainable and sustainability are used, their definitions are not very precise, especially when compromises are involved. An attempt is made here to give firm definition to these terms and to translate the definition into a series of laws and hypotheses which, it is hoped, will clarify the implications of their use. These are followed by a series of observations and predictions that relate to sustainability.     

Immigration policy and immigrant quality: empirical evidence from Canada

This paper examines the earnings of foreign-born and native-born men in an attempt to evaluate whether the decline in the quality of Canadian immigrants is related to changes in the country-of-origin mix and the class (type) mix of immigrants. Based on a human capital interpretation, higher quality immigrants are defined as immigrants who have smaller on-entry earnings differentials and have earnings that grow at a faster rate (relative to native-born Canadians). The analysis consists of two parts. The first part is based on individual data on earnings and socio-economic characteristics collected in the 1971 and 1986 Canadian Censuses. Earnings equations are estimated for 16 country-of-origin immigrant groups. These regressions are then used to construct a cohort-specific measure of immigrant quality based on the earnings differential between foreign-born and native-born Canadians. In the second part of the analysis, additional regression equations are estimated, pertaining to the period 1968 to 1985, that relate these Census-based measures of immigrant quality to the country-of-origin and class mix of immigrants. In this analysis, unpublished data, supplied by theDepartment of Employment and Immigration, describing the distribution of immigrants across the three main immigrant classes is used. Overall, the analysis confirms that there has been a sharp secular decline in the quality of Canadian immigrants and suggests that it is related to changes in both the country-of-origin and class mix of immigrants.Earlier versions of this paper were presented at the meetings of the Canadian Economics Association and the European Society for Population Economics. The comments of Martin Browning, John Ermisch and two anonymous referees are gratefully acknowledged. Of course, all remaining errors and shortcomings are the sole responsibility of the authors.     

Government fragmentation and suburban services: The equality of consumer choice

The predominant reform tradition of centralizing suburban government to deal with problems of inequality in the distribution of local services has been attacked recently by a new school of thought often labelled New Political Economists. This school believes that the existing structure of local government can maximize citizen choice by allowing citizens to shop around between the level and mix of public goods and services offered by alternate communities. The term polycentricity has been coined to describe this situation. Critics of polycentricity believe that the resulting quasi-market would be unfair to low and moderate income suburbanites. This paper examines the actual extent of choice in service levels available to different income groups located in the suburban ring of six metropolitan areas. The extent of inequality in choice between different income groups is measured and the implications of these findings for the conflict between polycentric and centralizing reformers is discussed.The research reported in this paper was funded by the National Science Foundation, Grant Number SOC7705600     

Earth,the Business of the Future: From Ego Energy to Eco Energy

Just as we have a turn around manager to save a failing business organization, so it is held, we need a turn around perspective to retrieve the Earth from being in a deficit position. Hence the paradoxical emphasis upon the Earth as the business of the future. Two important distinctions are offered which together provide a new frame of reference for bonding the human and the Earth. The initiating event for the first distinction was a business conference whose purpose was to explore the emerging domain of ego energy. In a parallel way, it is proposed we explore the yet to be discovered domain of eco energy. With eco energy we open our narrowed human window to cosmic perception. With cosmic perception, the energy of the universe can flow through us. The second distinction is between looking at and seeing. Looking at refers to treating our world as a collection of objects. As a collection of objects the Earth can be processed as a series of business transactions. With seeing we relate to our world as a communion of subjects. Such seeing offers transforming power for the human and the Earth to engage in the dialogue of powerful listening and speaking on both individual and planetary scale. These two sets of distinctions are sounded like echo chambers against ten ecologically guiding statements. These ten guiding statements become a reality-testing, experiential framework. Such a turn around perspective offers a different vision to be operationalized in our individual, community, and business lives. Then we can see clearly and respond with eco energy to the Earth, the business of the future!     

Immigrant and native responses to welfare reform

We investigate the effect of welfare reform in the US on the employment and hours of work of low-educated foreign-born and native-born women. For foreign-born women, we investigate whether the effect of welfare reform differed by year of immigration. We also examine whether the immigrant provisions of welfare reform had a chilling effect on those who remained eligible for benefits. Results suggest that welfare reform induced low-educated women to increase their labor market attachment; reform had larger effects on the least educated native-born women and among foreign-born, larger effects on more recent arrivals. The chilling hypothesis is not supported.All correspondence to Robert Kaestner. The authors thank Lynn Karoly, Christoph Schmidt, seminar participants at the University of Illinois and New School University, and several anonymous referees for comments on a previous draft of this paper. Robert Kaestner is grateful to the Luce Foundation for partial support for this research. Responsible editor: Christoph M. Schmidt.     

The welfare effects of labour force growth with internationally mobile capital

The effects of labour supply growth on the welfare of preexisting destination and non-emigrating source populations are analysed. This growth occurs in open economies where free trade in capital goods is possible. Traditional small economy arguments for population growth rely on the existence of priced though internationally immobile factors. When all factors are freely-traded and population grows naturally the case rests either on market distortions or common property within families. In an integrated world labour growth can lead to capital flight and increasing wage differentials. With international interactions, immigration increases preexisting welfare in destination countries but generally (not always) reduces it for non-emigrants in source countries. Immigration provides efficiency gains to all originally resident in source countries. Natural population growth anywhere promotes efficiency gains everywhere.