Immigration and labor markets

Chapter 1 presents a model that can be used to study the impact of high-skill immigration on wages and unemployment for both immigrants and natives, and to explain the following stylized fact: new immigrants, on average, have higher unemployment rates and earn lower wages than similar natives and recover this difference with time. A Mortensen and Pissarides style search and matching model is presented, in which two types of workers (immigrants and natives) search for similar vacancies. This framework is used to infer the relative importance of productivity and network differences for wages and unemployment between natives and immigrants using CPS data. The model indicates that both new and established immigrants are more productive than natives and have smaller network sizes.;Chapter 2 employs United States Census data to examine the occupational allocation of immigrants. The data reveal that the occupational shares of a variety of ethnic groups have grown drastically in particular labor markets over the period 1980 to 2000. This chapter examines the extent to which this growth can be attributed to network effects by studying the relationship between the occupation decision of recently arrived immigrants and those of their countrymen from previous waves of immigration. The empirical evidence strongly supports the presence of network effects in the immigrant labor market at the local level. Not only are new immigrants choosing the same occupations as their countrymen but those who locate in the "popular" occupations of their countrymen have higher wages, on average.;Chapter 3 explores the role of networks on immigrant unemployment duration. New immigrants use their resources, both financial and social, to find jobs. Most immigrants tend to be limited in the former and, as a consequence of the family reunification based U.S. immigration policy, relatively abundant in the latter. While many studies highlight the positive effect networks have on immigrant unemployment rates, little is known about the role of social networks on new unemployment duration. Empirical results based on the New Immigrant Survey dataset suggest that while the use of social ties is more prevalent for low skilled jobs, they reduce unemployment duration dramatically.