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March 02, 2020
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Posted by NCID

Immigration can affect the receiving country in different fields. One of the obvious ones is the composition of the labour force, especially when immigrants are a considerable component of the economy or when there is an immigration boom. At the beginning and during a recession, part of the public opinion point to migrants, whose role become part of the discussion.

Ismael Gálvez, a Ph.D. candidate at Universidad Carlos III, contributes evidence to this issue with his job market paper The Role of Immigration in a Deep Recession, which he presented at the Navarra Center for International Development last Tuesday, February 25. In his paper and based on Spanish data, Gálvez studies "the impact of these foreign-born workers on the labor market during a recession" through a "random search model of the labour market featuring vacancy persistence, endogenous return migration and wage rigidity", and finding that "immigrants smooth the recession and improve the welfare of natives."

You can read the full paper here.