This paper aims to conduct a holistic study on the effects of migration inflows received by developed OECD countries. Starting by examining the determinants of the displacement decision of individuals from their source nations, and ending with the quantification of the consequences of such fluxes on aggregate real outcomes for the receiving states. We contribute to the existing research on the topic in each step of our analysis.
Firstly, we extend the previously developed theoretical framework modeling ...
This paper aims to conduct a holistic study on the effects of migration inflows received by developed OECD countries. Starting by examining the determinants of the displacement decision of individuals from their source nations, and ending with the quantification of the consequences of such fluxes on aggregate real outcomes for the receiving states. We contribute to the existing research on the topic in each step of our analysis.
Firstly, we extend the previously developed theoretical framework modeling the migration decision by allowing time-varying origin-destination country-pair specific effects to also act as drivers of bilateral mobility within territories. Our main innovation at this point, is to empirically test the significance of covariates proxying the presence of previous networks of similar immigrants in host states. Such an inferential procedure is developed via a self-built panel database comprising information for 14 host OECD countries, 64 origin nations, and years from 1995 to 2019. Coefficients on the aforementioned variables are found positive and significant in all of the 12 alternative specifications being calculated. Presenting point estimates robust to distribution assumptions, through computational techniques, also constitutes an original point of this article.
The second stage of the developed empirical strategy consists of leveraging semiparametric models to inspect the presence of non-linearities in the first-phase specification. In this sense, significant evidence of the existence of non-parametric effects in the previous baseline statistical equation is also encountered.
Finally, the aforementioned formula is leveraged to predict the exogenous (only push-driven) component of migration flows. With such an identified shock, we rely on Local Projections to depict fact-driven impulse-response functions to population dynamics. The concluding findings indicate, overall, a positive reaction of the countries in the sample, in terms of productivity, capital dilution, and per capita output.
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