Does a change in immigration affect the unemployment rate in host countries? Evidence from Australia

Abstract

This study examines and evaluates the dynamic causality relationship between immigration, unemployment, wages and GDP per capita in host countries with a focus on Australia. Previous research has indicated that the economic impact of immigration is significant; nonetheless, its effect on the labour market being positive or negative is inconclusive. This study uses a Vector Error Correction Model (VECM) to examine the dynamic short-and long-run nexus between these variables in Australia over the period 1980-2016. The paper provides clear evidence to policy makers on the positive spillover effect of immigration policies developed by the Australian government.

The Fiscal Effect of Immigration: Reducing Bias in Influential Estimates

“…Studies have reached similar conclusions in the United Kingdom (Dustmann et al 2005), Canada (Islam 2007), Australia (AboElsoud et al 2020), and Germany (Pischke and Velling 1997;Felbermayr et al 2010). Substantial displacement of incumbents from employment is found in exceptional settings, such as when the a ected workers are teenagers (Smith 2012), or when the arriving workers are returning ethnic nationals (Glitz 2012;Braun and Mahmoud 2014) or non-resident day workers (Dustmann et al 2016a).…”

Trends of Migration Transformations in the Countries of the European Union and the Russian Federation: Identification of Predictors of Migration Processes in the Context of Migration Policy and Public Administration

“…This explains the relatively weak correlation level of 0.22 against the background of an equally low share of variability. The data of a number of studies and conclusions from the theories of migration used today suggest that the level of social support of migrants from the state, the possibilities of medical support, the availability of education, the degree of cultural integration and proficiency in the language of the host country (AboElsoud et al, 2020 ; Collins et al, 2020 ; Lundborg & Skedinger, 2016 ).…”

“…Currently, there are many studies examining the relationship between migration processes, social well-being, the state of the economy, and other socio-economic indicators. This particulary applies to issues such as a interconnection between immigration, unemployment, wages and gross domestic product per capita in host countries (AboElsoud et al, 2020 ; Bijak & Czaika, 2020 ; Zinn, 2016 ). The consequences of migratory movements are also that leisure spending reduces the net welfare gain from migration by one quarter relative to what consumption growth implies (Murard, 2020 ).…”

Empirical Literature on Economic Growth, 1991–2020: Uncovering Extant Gaps and Avenues for Future Research

“…However, immigration has contrasting impacts on the landscape of the host country, depending on the extent to which the residents and immigrants complement or replace each other (AboElsoud et al, 2020). According to the neoclassical growth model and the augmented Solow growth model, immigrant inflows increase the host country’s population and dilute the capital, which means a decrease in the long-run economic growth per capita (Kang & Kim, 2018).…”