Albrecht Glitz

The Economic Situation of First and Second‐Generation Immigrants in France, Germany and the United Kingdom*

A central concern about immigration is the integration into the labour market, not only of the first generation but also of subsequent generations. Little comparative work exists for Europes largest economies. France, Germany and the UK have all become, perhaps unwittingly, countries with large immigrant populations albeit with very different ethnic compositions. Today, the descendants of these immigrants live and work in their parents’ destination countries. This article presents and discusses comparative evidence on the performance of first and second-generation immigrants in these countries in terms of education, earnings and employment.

The Labor Market Impact of Immigration: A Quasi-Experiment Exploiting Immigrant Location Rules in Germany

With the fall of the Berlin Wall, ethnic Germans living in eastern Europe and the former Soviet Union were given the opportunity to migrate to Germany. Within 15 years, 2.8 million individuals had done so. Upon arrival, these immigrants were exogenously allocated to different regions to ensure an even distribution across the country. Their inflow can therefore be seen as a quasi-experiment of immigration. I analyze the effect of these inflows on skill-specific employment rates and wages. The results indicate a displacement effect of 3.1 unemployed workers for every 10 immigrants that find a job, but no effect on relative wages.

Migration and Education

Sjaastad (1962) viewed migration in the same way as education: as an investment in the human agent. Migration and education are decisions that are indeed intertwined in many dimensions. Education and skill acquisition play an important role at many stages of an individuals migration. Differential returns to skills in origin and destination country are a main driver of migration. The economic success of the immigrant in the destination country is to a large extent determined by his or her educational background, how transferable these skills are to the host country labor market and how much he or she invests in further skills after arrival. The desire to acquire skills in the host country that have a high return in the country of origin may be another important reason for a migration. From an intertemporal point of view, the possibility of a later migration may affect educational decisions in the home country long before a migration is realized. In addition, the decisions of migrants regarding their own educational investment and their expectations about future migration plans may affect the educational attainment of their children. But migration and education are not only related for those who migrate or their descendants. Migrations of some individuals may have consequences for educational decisions of those who do not migrate, both in the home and in the host country. By easing credit constraints through remittances, migration of some may help others to go to school. By changing the skill base of the receiving country, migration may change incentives to invest in certain types of human capital. In addition, migrants and their children may create externalities that influence educational outcomes of nonmigrants in the destination country. This chapter will discuss some of the key areas that connect migration and education.

How Do Industries and Firms Respond to Changes in Local Labor Supply

This paper analyzes how changes in the skill mix of local labor supply are absorbed by the economy, distinguishing between three adjustment mechanisms: wages, expansion in size of those production units using the more abundant skill group more intensively, and more intensive use of the more abundant skill group within production units. We contribute to the literature by analyzing these adjustments on the firm rather than industry level, using German administrative data. We show that most adjustments occur within firms through changes in relative factor intensities and that firms entering and exiting the market are an important additional absorption mechanism.