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The impact of immigration on the Spanish economy
Libertad González (Universitat Pompeu Fabra)
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1. Magnitude of recent immigration
• The foreign-born fraction of the working-age population increased from 2 to 16% in 10 years (1998-2008). – More than 5 million people!
• Significant slowdown since 2008.
• Large variation across Spanish regions.
3 Source: Padrón municipal (INE)
4 Source: Eurostat
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2. Labor market effects
• Large impact on total employment!
• Small (if any) impact on the wages or unemployment rates of natives.
• Some effect on the labor supply of skilled native women – With young children or elderly dependents – Through cheaper household services
6 Source: EPA (INE)
7 Source: Encuesta Anual de Coste Laboral (INE)
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Regional specialization and trade
• Small effect on regional specialization (national?).
• But: Changes in skill intensity at industry level. – Higher share of low-educated workers.
– Mostly in services and construction.
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3. Housing market effects • The large migration inflows increased the demand for
housing – Rental and ownership. – Leading to higher prices and/or construction activity?
• Immigration also increased labor supply in construction. – Leading to lower prices and/or higher construction activity?
• Overall effect? – Probably the demand effect dominated, and immigration
contributed to the housing market boom.
10 Source: Ministerio de Vivienda
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4. Migration and the recession
• The foreign-born population stabilized since 2008.
• Out-migration flows have accelerated.
• Migration flows seem to respond to economic conditions much more than drive them.
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References • “How Do Very Open Economies Absorb Large
Immigration Flows? Evidence from Spanish Regions.” (with Francesc Ortega) Labour Economics 18: 57-70 (2011).
• “Immigration, Family Responsibilities and the Labor Supply of Skilled Native Women” (with Lidia Farre and Francesc Ortega). The B.E. Journal of Economic Analysis & Policy: Vol. 11: Iss. 1 (Contributions), Article 34 (2011).
• “Immigration and Housing Booms: Evidence from Spain” (with Francesc Ortega). CReAM Discussion Paper No 19/09, July 2009.