Essays on the Economic and Social Impacts of Immigration

Abstract

This dissertation explores the economic and social impacts of immigration in three essays.

In the first chapter, I examine the impact of a large-scale immigration wave into Austria following the Cold War. Using an instrumental variables approach, I estimate the causal effect of immigration on the labor mobility and earnings of native Austrian workers. The immigration shock—which was primarily comprised of low-income blue-collar workers—caused a reallocation of native workers towards white-collar jobs. Panel data on the universe of formal workers allows me to identify the margins underlying this reallocation. Immigration did not increase the rate at which blue-collar workers left employment. Instead, immigration increased the rate blue-collar workers transitioned into white-collar jobs and changed the composition of newly hired workers.

In the second chapter, I present a dynamic spatial model of labor markets that examines the adjustment process of workers in the presence of imperfect mobility. The model builds on recent models in trade and urban economics and adapts them to highlight margins that are especially important in the context of immigration. Simulations from a hypothetical economy show that a labor supply shock will affect the mobility decisions not only of those in the exposed region, but also in those regions connected through mobility networks. These spillovers highlight potential pitfalls in empirical work that are not always accounted for in empirical studies.

In the third chapter, Alexander Billy and I calculate the crime effects attributable to the Mariel Boatlift, the 1980 Cuban refugee crisis that increased Miami’s population by nearly 10%. Using synthetic control methods to match Miami with cities that exhibit similar pre-intervention crime patterns, we find evidence the phenomenon comparatively increased property crime and murder rates; we also document weaker but suggestive relative growth in violent crime. Compositional features of the newcomers seemingly drive our results; the disproportionately young, male Cuban’s characteristics highly correlate with illicit activity. Given the group’s unique composition and the absence of rigorous screening, our findings likely constitute the upper bound of migration caused crime.