1 The Impact of Immigration on the New Zealand Labour Market Michael Tse & Sholeh A. Maani The University of Auckland Economics Department Paper presented at ‘Economic Impacts of Immigration and Population Diversity, International Workshop’, 11-13 April 2012
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The Impact of Immigration on the New Zealand Labour Market
The Impact of Immigration on the New Zealand Labour Market. Paper presented at ‘ Economic Impacts of Immigration and Population Diversity, International Workshop ’ , 11-13 April 2012. Michael Tse & Sholeh A. Maani The University of Auckland Economics Department . Question & Motivation. - PowerPoint PPT Presentation
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The Impact of Immigration on the New Zealand Labour Market
Michael Tse & Sholeh A. Maani
The University of AucklandEconomics Department
Paper presented at ‘Economic Impacts of Immigration and Population Diversity, International Workshop’, 11-13 April 2012
Question & Motivation• A large segment of the NZ population is
foreign-born (almost a quarter).
• A key policy question is whether or not immigration affects the labour market opportunities of the existing workforce?
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The direction of the impact on existing
workers is dependent on a number of factors. These include:
• Substitutability between immigrants and natives. Are immigrants and the native-born with similar educational qualifications complete substitutes?
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Elasticity of substitution
• If immigrants and natives are substitutes, then the inflow of immigrants would reduce wages in the labour market (Borjas, 2003; Orrenius & Zavodny, 2007)
• If immigrants complement native workers, then we would expect positive changes to earnings from immigration (Ottaviano & Peri, 2007; Borjas, Grogger & Hanson, 2008)
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Immigrant education and experience
• The value placed on education and experience acquired abroad is often less than the value placed on domestic education and experience (Lalonde & Topel, 1991; Duleep & Regets, 2002; Akresh, 2006; Antecol, Kuhn & Trejo, 2006)
International literature • Altonji & Card 1991 and Borjas 2003: 10
% point increase in fraction of immigrants reduces the wages of less skilled by 3-4 %.
• Card 2005, Addison and Worswick 2002 : Mare’ and Stillman 2009, no significant adverse effect
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Modelling approaches of wage effects for the native-born