The Role of Labor Market Institutions in the Impact of Immigration on Wages and Employment

Mette Foged | Linea Hasager | Vasil Yasenov
The Scandinavian Journal of Economics

We collect 1,030 previously estimated wage effects and 432 employment effects of immigration and document that the mean and median impact on the relative wage are negative and significantly different from the small positive mean and median impact on the average wage. The pattern is reversed for employment effects where the magnitudes are also smaller. Combining the effect sizes with measures of labor market institutions we find that institutions may shield native workers from relative wage consequences but reduce the average wage impact of immigration. We do not detect a significant and robust association for the employment effects.