migration – BSE Voice

Migration Shocks and Occupational Downgrading: Evidence from Venezuelan Migrants in Chile

Economics master project by Sunidhi Agarwal, Ignacio Ariznavarreta, Nour Chamseddine, Ricardo Gonçalves, and Ignacio Ramón Oliva ’22

Overlapping flags of Venezuela and Chile

Editor’s note: This post is part of a series showcasing Barcelona School of Economics master projects. The project is a required component of all BSE Master’s programs.

Abstract

This paper examines the downgrading in job status that immigrant workers suffer when settling in a new country. We consider the massive Venezuelan exodus and the impacts this shock had on the job outcomes of migrants who settled in Chile.

Our approach is based on linear regression analysis and multinomial logistic regression models to estimate the penalty immigrants face. To this end, we use household-level data and employ two job-status indexes.

Results show that migrants who arrived before the 2015 Venezuelan crisis did not face significant downgrading. However, migrants who have arrived after 2015 do. Findings are relevant to understanding the impact of massive and sudden migratory shocks.

Read this paper in the online repository

Connect with the authors

The authors pose for a group photo outside the graduation venue on a sunny day in Barcelona — The authors celebrate together at their graduation ceremony in Barcelona (July 2022).

Author info is current as of February 2023.

Sunidhi Agarwal ’22 is a Research Consultant at the Inclusion Economics, which is an India center of Inclusion Economics at Yale University.
Ignacio Ariznavarreta ’22 is an Analyst at Compass Lexecon in Madrid, Spain.
Nour Chamseddine ’22 is a student in the International Doctorate in Economic Analysis (IDEA) Graduate program organized by UAB and BSE.
Ricardo Gonçalves ’22 is a Game Data Scientist at Socialpoint in Barcelona.
Ignacio Ramón Oliva ’22 is a PhD student in Agricultural & Resources Economics at UC Davis in the United States.

About the BSE Master’s Program in Economics

The Impact of the 2014-2016 Russian Financial Crisis on Remittances, Consumption, and Credit: The Case of Kyrgyzstan

International Trade, Finance, and Development master project by Rachel Breaks, Clément Durif, Peiyao Sun, and Joule Voelz ’22

Life in the Kyrgyz mountains. A family works and plays outside on a vast, green plain with rolling hills and mountains in the background under a blue sky dotted with fluffy white clouds. The family is in front of a white canopy tent and a beige dome hut, and a few horses graze around them. — Photo by Oziel Gómez on Unsplash

Editor’s note: This post is part of a series showcasing Barcelona School of Economics master projects. The project is a required component of all BSE Master’s programs.

Abstract

In this paper we consider the negative medium-term impact of the Russian Financial Crisis of 2014-2016 on remittances, consumption patterns, and credit in the Kyrgyz Republic.

Using panel data from the Life in Kyrgyzstan survey, we show a significant drop in migration to Russia and remittances from Russia on the extensive and intensive margins.

Households with a migrant abroad in Russia just prior to the crisis experience an average fall in real per capita income and an increase in poverty, while households both with and without a migrant rebalance their consumption basket to cope with the economic downturn.

Read this paper in the online repository

Connect with the authors

Author info is current as of February 2023.

Rachel Breaks ‘22 is from Manchester, UK. She now works for the UK Government on international trade strategy with Latin America and the Caribbean.
Clément Durif ‘22 is from Nice, France. He now works at Asia Centre, a Paris-based think tank specializing in international relations.
Peiyao Sun ‘22 is from Hangzhou, ZJ (China). She is a pre-doctoral fellow at the ETH-Zurich in Zurich, Switzerland.
Joule Voelz ’22 is from San Francisco, CA (USA). She is a Data Science Methodology student at the Barcelona School of Economics.

About the BSE Master’s Program in International Trade, Finance, and Development

The Asymmetric Unemployment Response of Natives and Foreigners to Migration Shocks

Working Paper by Nicolò Maffei Faccioli (Macro ’15 and IDEA) and Eugenia Vella (Sheffield)

What is the macroeconomic impact of migration in the second-largest destination for migrants after the United States?

In this paper, we uncover new evidence on the macroeconomic effects of net migration shocks in Germany using monthly data from 2006 to 2019 and a variety of identification strategies in a structural vector autoregression (SVAR). In addition, we use quarterly data in a mixed-frequency SVAR.

While a large literature has analyzed the impact of immigration on employment and wages using disaggregate data, the migration literature in the context of macroeconometric models is still limited due to a lack of data at high frequency. Interestingly, such data is available for Germany. The Federal Statistical Office (Destatis) has been collecting monthly data on the arrivals of foreigners by country of origin on the basis of population registers at the municipal level since 2006. The figure below shows the net migration rate by origin.

Key takeaways

Migration shocks are persistently expansionary, increasing industrial production, per capita GDP, investment, net exports and tax revenue.

Our analysis disentangles the positive effect on inflation of job-related migration from OECD countries from the negative effect of migration (including refugees) from less advanced economies. In the former case, a demand effect seems prevalent while in the latter case, where migration is predominantly low-skilled and often political in nature (including refugees), a supply effect prevails.

In the labor market, migration shocks boost job openings and hourly wages. Unemployment falls for natives, driving a decline in total unemployment, while it rises for foreigners (see figure below). Interestingly, migration shocks (blue area in the first row) play a relevant role in explaining fluctuations in industrial production and unemployment of both natives and foreigners, despite the bulk of these being explained by other shocks (red area in the first row), like business cycle and domestic labor supply.

We also shed light on the employment and participation responses for natives and foreigners. Taken together, our results highlight a job-creation effect for natives and a job-competition effect for foreigners.

Conclusion

The COVID-19 recession may trigger an increase in migration flows and exacerbate xenophobic sentiments around the world. This paper contributes to a better understanding of the migration effects in the labor market and the macroeconomy, which is crucial for migration policy design and to curb the rise in xenophobic movements.

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Connect with the authors

Niccolò Maffei-Faccioli ’15 (Macroeconomic Policy and Financial Markets) is a PhD candidate in Economics at Universitat Autònoma de Barcelona and Barcelona GSE (IDEA).
Eugenia Vella is a Lecturer at University of Sheffield.

About the BSE Master’s Program in Macroeconomic Policy and Financial Markets