Do Immigrants Take or Create Residents’ Jobs? Quasi-Experimental Evidence from Switzerland
KOF Working Papers No. 335
63 Pages Posted: 14 Jun 2013
Date Written: May 2013
We estimate the causal effect of immigration on the labor market outcomes of resident employees in Switzerland, whose foreign labor force has increased by 32.8% in the last decade. To address endogeneity of immigration into different labor market cells, we develop new variants of the shift-share instrument, tailored for small-open economies, that exploit only that part in the variation of immigration which can be explained by migration push-factors in the source countries. We find that immigration has reduced unemployment of residents and has enabled them to fill more demanding jobs, while it had no adverse effect on wages and employment.
Keywords: Immigration, native employment, labor shortage, shift-share instrument
JEL Classification: F22, J21, J61
Suggested Citation: Suggested Citation