Explaining Cross-Country Differences in Labor Market Gaps between Immigrants and Natives in the OECD

Arbeitspapier

In most OECD-countries, immigrants have lower employment and higher unemployment than natives. This paper compares nine potential explanations of these gaps. Results are obtained for 21-28 countries using bivariate correlations, OLS-regressions and Bayesian model averaging over all 512 theoretically possible model specifications. Two robust patterns are found. The unemployment gap is bigger in countries where collective bargaining agreements cover a larger share of the labor market. The employment gap is bigger in countries with more generous social safety nets. Five variables have explanatory value in some specifications: Xenophobia, employment protection laws, social expenditure, asylum applications, and the share of immigrants in the population. The education of immigrants and migrant integration policies have no explanatory value. A trade-off seems to exist such that countries with smaller labor market gaps have higher income inequality.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IFN Working Paper ; No. 1036

Classification and Topics

• Classification: Wirtschaft ; Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity ; Trade Unions: Objectives, Structure, and Effects ; Mobility, Unemployment, Vacancies, and Immigrant Workers: General ; Labor Discrimination
• Subject: Labor market segregation ; Immigration ; Insider-outside hypothesis

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Bergh, Andreas
• Event: Veröffentlichung
• (who): Research Institute of Industrial Economics (IFN)
• (where): Stockholm
• (when): 2014

Further information

• Handle: http://hdl.handle.net/10419/109129
• Last update: 10.03.2025, 11:46 AM CET