Essays on the impact of immigration.

Abstract

This thesis addresses the impact of immigration on labour market outcome, trade creation and foreign direct investment through three main chapters. The first chapter examines the influence of foreign-born workers on female wages in the UK labour market. Unlike the majority of prior studies, this chapter focuses solely on the female context. It employs an empirical technique borrowed from Heckman (1974) in order to account for the sample selection problem while also examining the influence of foreign-born individuals utilising gender-specific qualification shares. This study concludes that there is no negative impact on the wages of native females. Additionally, it was discovered that foreign-born female shares had a negative influence on the earnings of foreign-born females who work in the UK, with the effect varying depending on the share. The second chapter investigates the impact of immigration networks on trade creation within the EU. Following the 2004 EU enlargement, citizens of new EU countries should have unrestricted access to the older EU member states. However, some countries established a transitional arrangement that they maintained for several years following the enlargement before allowing unrestricted migration. This chapter focuses on the period of time when free movement was permitted as a natural experiment so as to examine the effect of immigration on bilateral trading between EU countries. Based on previous research, this study employed the gravity model, with some modifications: the model was estimated using Difference in Difference estimation. A positive and statically significant impact was found on the import and the export of immigration networks. The third chapter examines the relationship between immigration and foreign direct investment flows from and to 15 former EU member countries during a 20-year period from 1998 to 2018. To address this relationship, this chapter utilises the standard Difference in Difference technique to estimate the gravity model, taking advantage of the time variation in the availability of free immigration movement to these 15 EU countries after the 2004 enlargement. It compares the impact of immigration across the old and new EU‘s immigrations, and the chapter also extends the analysis to include other countries from outside of the EU. The results demonstrate that immigration has a consistent and significant positive effect on FDI mobility.

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ORCID for Jackline Wahba: orcid.org/0000-0002-0002-3443

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