This project assesses the effect of the immigration on the production structure in a selection of European countries in 2001-2009. The inflow of immigrants represents an increase in the labor supply, but when we consider skills and abilities of migrants and natives, this increase can be more properly interpreted as a positive change in the relative supply of manual-physical (or simple) tasks. The analysis should test whether the increase in migration stocks has caused a production bias towards sectors that use more intensively simple rather than complex tasks. We consider more thoroughly the case of countries such as Italy and Spain that have been characterized by a more rapid and more intense inflow of migrants with respect to Northern European countries.
The contribution of this project is fourfold.
First, we want to consider different datasets to map occupations into tasks. In particular, we aim at using a new database, PIAAC (Programme for the International Assessment of Adult Competencies, OECD), to calculate the ¿Task Intensity Index¿ at industry level. Only three countries have task data available: the United States (see Autor et al. (2003)), Germany and Britain. The data sources for analysis on job tasks come from a module of the Princeton Data Improvement Initiative survey (PDII) to the Survey of Skills, Technology, and Management Practices (STAMP).
All datasets provide information on job tasks at the single-country level. For instance, the survey of Skills, Technology, and Management Practices (STAMP) fielded by Michael Handel provides a detailed cross-sectional view of work activities in the U.S. German Qualification and Career Survey, which is conducted jointly by the Federal Institute for Vocational Education and Training (BIBB) and the Institute for Employment (IAB) offer detailed self-reported data on workers¿ primary activities at their jobs.
The main advantage of using the international survey PIAAC, which also uses a self-reported individual worker's survey, is that it allows to highlight the country-specific differences across the European countries.
Second, in the estimation we want to see linear and nonlinear effects of the type of production structure (whether simple-task intensive or complex-task intensive) on the effect of migration. Our a-priori is that migration may have positive effects on the relative output of simple-task intensive sectors, but negative effects on complex-task intensive sectors (as in the Rybczynski theorem).
Third, as typical in this literature, one of the main problems to obtain a significant causal effect of migration is to overcome the problem of contemporaneous causality. Building on the work by Ortega and Peri (2014), we intend to propose instrumental variables based on a gravity approach to migration, which we deem is particularly suited for our case.
Fourth, Spain and Italy could be considered as peculiar case of countries characterized by rapid and intense immigration. For these two countries simple-task intensive sectors already take an important fraction of the production structure. Therefore, we intend to single out these two latter countries in order to evaluate whether immigration had a significantly different effect with respect to the average European countries.
References
Autor, D. H., Levy, F., and Murnane, R. J. (2003). The Skill Content of Recent Technological Change: An Empirical Exploration. Quarterly Journal of Economics, 118:1279¿ 1333.
Ortega, F. and Peri, G. (2014). Openness and income: The roles of trade and migration. Journal of International Economics, 92(2):231¿251.