Immigrants, occupations and firm export performance

Abstract

This paper investigates the export‐enhancing effect of immigrant workers and how this effect varies across occupations. We use a dataset made of French manufacturing firms from 1997 to 2009 and address the problem of endogenous employment choice using an instrumental variable‐two‐stage least squares (IV‐2SLS) strategy and a doubly robust estimator. Our results show that immigrants in both low‐ and high‐skilled occupations foster exports at both the intensive and the extensive margins. In addition, we show that this effect is spread across all export destinations.

Foreign workers, product quality, and trade: Evidence from a natural experiment

“…The positive role of migrants on trade has been extensively analyzed by various papers (e.g., Head and Ries, 1998;Rauch, 1999Rauch, , 2001Rauch and Trindade, 2002;Felbermayr and Toubal, 2012). While most of the earlier contributions fail to convincingly assess a causal relation due to endogeneity issues and poor data quality (Felbermayr et al, 2015), recent papers use instrumental variable strategies (Peri and Raquena-Silvente, 2010;Ottaviano et al, 2018;Cardoso and Ramanarayanan, 2019;Marchal and Nedoncelle, 2019;Orefice et al, 2021) or natural experiments (Parsons and Vézina, 2018;Bahar et al, 2022;Olney and Pozzoli, 2021) to assess causality. However, these papers either do not allow to distinguish the skill of the migrant or embed almost exclusively low skilled migrant flows (mostly from developing countries), and we know little about the mechanisms by which foreign workers foster trade.…”

Immigrants and exports: Firm‐level evidence from Canada

“…Since the work of Gould (1994) augmenting gravity equations with immigrant stocks using aggregate US data, researchers have taken several approaches to overcome identification and endogeneity issues with aggregate data. Most closely related to our paper are studies using matched worker-firm data sets from different countries: Hiller (2013), Hatzigeorgiou and Lodefalk (2016), Andrews et al (2017), Ottaviano et al (2018) and Marchal and Nedoncelle (2019). The first four of these (using Danish, Swedish, German and UK data, respectively) use IV methods and Marchal and Nedoncelle (2019) (with French data) uses propensity score matching methods.…”

“…Most closely related to our paper are studies using matched worker-firm data sets from different countries: Hiller (2013), Hatzigeorgiou and Lodefalk (2016), Andrews et al (2017), Ottaviano et al (2018) and Marchal and Nedoncelle (2019). The first four of these (using Danish, Swedish, German and UK data, respectively) use IV methods and Marchal and Nedoncelle (2019) (with French data) uses propensity score matching methods. Relative to these papers, we introduce a novel method based on previously unexplored implications of firms' immigrant employment decisions, we provide evidence that the trade-creation effect varies with immigrant characteristics in ways consistent with the idea that immigrants reduce information barriers and we analyze newly created data for Canada.…”

Migrants and Global Value Chains: Evidence from Dutch Firms

“…Similarly, it is also possible for immigrants to generate additional demand for the importation of ethnic products from their countries of origin, depending on their preferences (Gould, 1994;Head and Ries, 1998;Dunlevy and Hutchinson, 1999). Importantly, the significant part of these studies has been devoted to exports (Peri and Requena-Silvente, 2010;Hiller, 2013;Hatzigeorgiou and Lodefalk, 2016;Parrotta et al, 2016;Andrews et al, 2017;Mitaritonna et al, 2017;Marchal and Nedoncelle, 2019). The few studies that also take into account imports mostly attempt to compare the effectiveness of knowledge and preference channels by contrasting the effect on exports and imports (Gould, 1994;Head and Ries, 1998;Girma and Yu, 2002;Rauch and Trindade, 2002;Wagner et al, 2002;Aleksynska and Peri, 2014;Steingress, 2018).…”

“…Our paper is also related to the literature that examines the heterogeneities of migrants in explaining the migration-trade relationship. Among them are levels of skill or education (Gould, 1994;Hatzigeorgiou and Lodefalk, 2016;Andrews et al, 2017;Marchal and Nedoncelle, 2019), managerial role in the firm (Aleksynska and Peri, 2014;Andrews et al, 2017), duration of stay in the host country (Gould, 1994;Hatzigeorgiou and Lodefalk, 2016), and reasons for migration such as entrepreneurship, family reunification, or refugee status (Head and Ries, 1998). Different from these approaches, we examine whether the age at which immigrants arrive in a host country determines the level of knowledge that affects trade.…”