Olof Åslund

Ethnic Enclaves and the Economic Success of Immigrants—Evidence from a Natural Experiment

Recent immigrants tend to locate in ethnic ”enclaves” within metropolitan areas. The economic consequence of living in such enclaves is still an unresolved issue. We use an immigrant policy initiative in Sweden, when government authorities distributed refugee immigrants across locales in a way that may be considered exogenous. This policy initiative provides a unique natural experiment, which allows us to estimate the causal effect on labor market outcomes of living in enclaves. We find substantive evidence of sorting across locations. When sorting is taken into account, living in enclaves improves labor market outcomes; for instance, the earnings gain associated with a standard deviation increase in ethnic concentration is in the order of four to five percent.

Now and Forever? Initial and Subsequent Location Choices of Immigrants

This paper exploits a natural experiment to study the influence of regional factors on initial and subsequent location choices among immigrants. The results suggest that immigrants to Sweden are attracted to regions with high representation from the individual’s birth country and large overall immigrant populations. Labor market opportunities affect location decisions, but people also tend to choose localities with many welfare recipients. The impact of most regional factors does not change over time. Thus, there is little evidence that information improves or that preferences differ between initial and subsequent stages.

Do When and Where Matter? Initial Labor Market Conditions and Immigrant Earnings

This paper investigates the long-term effects on immigrant earnings and employment from labor market conditions encountered upon arrival. We find substantial effects both of the state of the national labor market and of local unemployment rates. Comparing refugees entering Sweden in a severe and unexpected recession to refugees arriving in a preceding economic boom, we attempt to handle the issue of selective migration. The analysis of effects at the local level exploits a governmental refugee settlement policy to get exogenous variation in local labor market conditions.

Will I See You at Work? : Ethnic Workplace Segregation in Sweden, 1985-2002

Using linked employer-employee data covering the entire working-age Swedish population between 1985 and 2002, the authors present evidence of substantial and increasing ethnic workplace segregation. Moreover, when human capital, geography and industrial affiliation are taken into account, immigrants are overexposed both to workers from their own birth region and to immigrants from other regions. Segregation is generally negatively correlated with economic status: groups with low employment rates are more segregated from natives; groups with many immigrant colleagues earn less than those with more native colleagues; and the higher the number of immigrants to which individuals are exposed, the lower their wages. When local labor market conditions improve, however, segregation decreases. Though the degree and nature of segregation varies substantially across ethnic groups, the patterns are quite persistent over time.

Peers, neighborhoods and immigrant student achievement : evidence from a placement policy

We examine to what extent immigrant school performance is affected by the characteristics of the neighborhoods that they grow up in. We address this issue using a refugee placement policy which provides exogenous variation in the initial place of residence in Sweden. The main result is that school performance is increasing in the number of highly educated adults sharing the subject�s ethnicity. A standard deviation increase in the fraction of high-educated in the assigned neighborhood raises compulsory school GPA by 0.9 percentile ranks. This magnitude corresponds to a tenth of the performance gap between refugee immigrant and nativeborn children.

Do Anonymous Job Application Procedures Level the Playing Field

Despite anti-discrimination legislation and the potential for hefty fines, labor market discrimination remains an issue for ethnic minorities and women, particularly in the recruitment and screening process. The apparent failure of legal and voluntary interventions has created a call for anonymous application procedures (AAP), in which key identifying data is hidden from recruiters in the initial recruiting process. Using unusually rich Swedish data on actual applications and recruitments, the authors show that AAP increased the chances of both women and individuals of non-Western origin of advancing to the interview stage. In addition, results show that women experienced an increased probability of being offered a job under AAP. However, applicants belonging to ethnic minorities were equally disadvantaged in terms of job offers under conventional and anonymous hiring procedures, suggesting that racial and ethnic discrimination may be harder to circumvent than gender discrimination.

Seeking Similarity : How Immigrants and Natives Manage in the Labor Market

We investigate how the interplay between manager and worker origin affects hiring patterns, job separations, and wages. Numerous specifications utilizing a longitudinal matched employer-employee database including 70,000 establishments consistently show that managers are substantially more likely to hire workers of their own origin. Workers who share an origin with their managers earn higher wages and have lower separation rates than dissimilar workers, but this pattern is driven by differences in unobserved worker characteristics. Our findings indicate that the sorting patterns are more likely to be explained by profit-maximizing concerns than by preference-based discrimination.

Peer Effects in Welfare Dependence: Quasi-Experimental Evidence

This paper examines peer effects in welfare use among refugees. We exploit a Swedish refugee placement policy, which generated exogenous variation in peer group composition. Our analysis distinguishes between the quantity of contacts—the number of individuals of the same ethnicity—and the quality of contacts —welfare use among members of the ethnic group. Long-term welfare dependence increases if the individual is placed in a welfare dependent community. The number of contacts is either irrelevant or negatively related to welfare receipt; not controlling for residential self-selection yields the opposite conclusion. The results are very similar across household types and in different parts of the predicted earnings distribution.

Virtues of SIN: Can Intensified Public Efforts Help Disadvantaged Immigrants?

The labor market integration of immigrants is a top political priority throughout the Organization for Economic Cooperation and Development (OECD) countries. Social and fiscal gains, as well as sustained future labor supply make governments search for effective policies to increase employment among the mostly disadvantaged. The author studies SIN, a Swedish pilot workplace introduction program targeting these groups, using very detailed individual data and allowing for effects through several channels. The results show increased transitions from unemployment to work experience schemes and improved future employment probabilities for those who entered these schemes. A rough calculation suggests that each job year created cost about Euro 30,000.

Nordic Economic Policy Review : Labour Market Integration in the Nordic Countries

What can we learn from each other and others? Since the mid-eighties the Nordic countries have received a high influx of refugees relative to the population size. Currently these countries receive ...