Immigration is not evenly balanced across groups of workers that have the same education but differ in their work experience, and the nature of the supply imbalance changes over time. This paper develops a new approach for estimating the labor market impact of immigration by exploiting this variation in supply shifts across education-experience groups. I assume that similarly educated workers with different levels of experience participate in a national labor market and are not perfect substitutes. The analysis indicates that immigration lowers the wage of competing workers: a 10 percent increase in supply reduces wages by 3 to 4 percent.

While an extensive literature examines the impact of low-skilled immigration on U.S. native wages, there has been almost no research on the parallel question of how immigration affects the price of goods and services. A standard small open economy model suggests that low-skilled immigration should reduce the relative price of non-traded goods by decreasing the wages of low-skilled workers. Treating U.S. cities as small open economies and using confidential price data on goods and services to estimate reduced-form price effects, I find that, at current immigration levels, a 10 percent increase in the share of low-skilled immigrants in the labor force decreases the price of immigrant-intensive services, such as housekeeping and gardening, by 2.1 percent and of other non-traded goods by 0.7 percent. Structural estimates suggest that lower wages are a likely channel through which these effects take place. However, wage effects are significantly larger for low-skilled immigrants than for low-skilled natives because the two are imperfect substitutes. Overall, the results imply that the lowskilled immigration wave of the 1990s increased the purchasing power of high-skilled natives living in the 25 largest cities by 0.6 percent but decreased the purchasing power of native high school dropouts by 1.3 percent.

This paper reviews the recent evidence on U.S. immigration, focusing on two key questions: (1) Does immigration reduce the labor market opportunities of less-skilled natives? (2) Have immigrants who arrived after the 1965 Immigration Reform Act successfully assimilated? Looking across major cities, differential immigrant inflows are strongly correlated with the relative supply of high school dropouts. Nevertheless, data from the 2000 Census shows that relative wages of native dropouts are uncorrelated with the relative supply of less-educated workers, as they were in earlier years. At the aggregate level, the wage gap between dropouts and high school graduates has remained nearly constant since 1980, despite supply pressure from immigration and the rise of other education-related wage gaps. Overall, evidence that immigrants have harmed the opportunities of less educated natives is scant. On the question of assimilation, the success of the U.S.-born children of immigrants is a key yardstick. By this metric, post-1965 immigrants are doing reasonably well: second generation sons and daughters have higher education and wages than the children of natives. Even children of the leasteducated immigrant origin groups have closed most of the education gap with the children of

Abstract—This paper uses three years of individual-level data to analyze the determinants of individual preferences over immigration policy in the United States. We have two main empirical results. First, less-skilled workers are signi � cantly more likely to prefer limiting immigrant in � ows into the United States. Our � nding suggests that, over the time horizons that are relevant to individuals when evaluating immigration policy, individuals think that the U.S. economy absorbs immigrant in � ows at least partly by changing wages. Second, we � nd no evidence that the relationship between skills and immigration opinions is stronger in high-immigration communities. I.

Abstract: Previous research has reached mixed conclusions about whether higher levels of immigration reduce the wages of natives. This paper reexamines this question using data from the Current Population Survey and the Immigration and Naturalization Service and focuses on differential effects by skill level. Using occupation as a proxy for skill, the authors find that an increase in the fraction of workers in an occupation group who are foreign born tends to lower the wages of low-skilled natives—particularly after controlling for endogeneity—but does not have a negative effect among skilled natives. JEL classification: J61 Key words: immigrants, natives, wages

Vogler for able research assistance and conference participants, especially Riccardo Faini, for helpful comments.

This paper studies the effect of increased immigration in Austria on the unemployment risk of young natives. Austria experienced a dramatic rise in the share of alien workers as a result of the breakdown of the former communist regimes (especially from former Yugoslavia). We concentrate on unemployment entry of young male workers, who are supposed to compete most heavily with new immigrants. Our results indicate that the detrimental impact - if it exists at all - is only minor. This is irrespective of the analyzed proxy for competition: The share of foreign workers in an industry or in a region. JEL: J61, J15, J64. Keywords: Immigration, unemployment risk, native workers, 3 1. Immigration in Austria: Institutions and Recent Experience In recent years, immigration of labor increased in many European countries following the breakdown of former communist regimes and the resulting opening of the external borders in these countries. In the host countries, immigration is opposed by many...

The rapid growth in the number of foreign students enrolled in American universities has transformed the higher education system, particularly at the graduate level. Many of these newly minted doctorates remain in the United States after receiving their doctoral degrees, so that the foreign student influx can have a significant impact in the labor market for high-skill workers. Using data drawn from the Survey of Earned Doctorates and the Survey of Doctoral Recipients, the study shows that a foreign student influx into a particular doctoral field at a particular time had a significant and adverse effect on the earnings of doctorates in that field who graduated at roughly the same time. A 10 percent immigration-induced increase in the supply of doctorates lowers the wage of competing workers by about 3 to 4 percent. About half of this adverse wage effect can be attributed to the increased prevalence of low-pay postdoctoral appointments in fields that have softer labor market conditions because of large-scale immigration. 2

This report, commissioned by the Treasury, reviews the international and New Zealand evidence on trends in the distribution of earnings over the past 20 years. It assesses the international evidence on the strength of the various explanations for changes in the earnings distribution. It concludes with suggestions on how the trends in the earnings distribution in New Zealand might be further analysed. Considerable variation has occurred in trends in the distribution of earnings between industrialised economies, with English speaking countries showing the greatest increases in earnings inequalities, and European countries showing the least. The New Zealand evidence also shows a growth in earnings inequality, and indicates that this has been due to both growth in inequality in wage rates and in weekly hours of work. Trends in earnings inequalities together with changes in the distribution of employment appear to explain much of the movement in income inequality in New Zealand. The international literature has attributed changes in the distribution of earnings to labour supply side factors (eg, education, age, gender), demand side factors (eg, technological change, international trade), and institutional factors (eg, union effects, labour market regulation). The

Immigration to the UK has risen in the past 10 years and has had a measurable effect on the supply of different types of labour. But, existing studies of the impact of immigration on the wages of native-born workers in the UK (e.g. Dustmann, Fabbri and Preston, 2005) have failed to find any significant effect. This is something of a puzzle since Card and Lemieux, (2001) have shown that changes in the relative supply of educated natives do seem to have measurable effects on the wage structure. This paper offers a resolution of this puzzle – natives and immigrants are imperfect substitutes, so that an increase in immigration reduces the wages of immigrants relative to natives. We show this using a pooled time series of British cross-sectional micro data of observations on male wages and employment from the mid-1970s to the mid-2000s. This lack of substitution also means that there is little discernable effect of increased immigration on the wages of native-born workers.