IDEAS home Printed from https://ideas.repec.org/a/bla/worlde/v47y2024i2p590-617.html
   My bibliography  Save this article

Extra‐EU immigrants and labour productivity: New evidence from Italian firms

Author

Listed:
  • Claudia Vittori
  • Andrea Ricci
  • Valentina Ferri

Abstract

This paper investigates the impact of extra‐EU workers on labour productivity in Italy. To this aim, we take advantage of firm‐level data derived from the Rilevazione Imprese e Lavoro (RIL‐AIDA) surveys merged with the AIDA‐Bureau Van Dijk archive over the period 2007–2015. Using an econometric strategy that accounts for firms' observed heterogeneity and endogeneity issues, we obtain the following results. First, an increase in the share of extra‐EU workers leads to a decline in labour productivity. Second, the relationship between extra‐EU workers and productivity appears to be different between firms located in centre‐north and those in southern regions. Third, the share of extra‐EU workers is also associated with a decline in average wages and sales per employee, even though this effect is less than that observed for productivity. Our findings support the hypothesis that the demand of immigrants arises as a labour cost reduction strategy and hence tends to weaken firms' competitiveness.

Suggested Citation

  • Claudia Vittori & Andrea Ricci & Valentina Ferri, 2024. "Extra‐EU immigrants and labour productivity: New evidence from Italian firms," The World Economy, Wiley Blackwell, vol. 47(2), pages 590-617, February.
    • Handle: RePEc:bla:worlde:v:47:y:2024:i:2:p:590-617
    DOI: 10.1111/twec.13430
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/twec.13430
    Download Restriction: no
    File URL: https://libkey.io/10.1111/twec.13430?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Libertad Gonzalez & Francesc Ortega, 2013. "Immigration And Housing Booms: Evidence From Spain," Journal of Regional Science, Wiley Blackwell, vol. 53(1), pages 37-59, February.
    2. Martins, Pedro S. & Piracha, Matloob & Varejão, José, 2018. "Do immigrants displace native workers? Evidence from matched panel data," Economic Modelling, Elsevier, vol. 72(C), pages 216-222.
    3. David Card & Christian Dustmann & Ian Preston, 2012. "Immigration, Wages, And Compositional Amenities," Journal of the European Economic Association, European Economic Association, vol. 10(1), pages 78-119, February.
    4. Milo Bianchi & Paolo Buonanno & Paolo Pinotti, 2012. "Do Immigrants Cause Crime?," Journal of the European Economic Association, European Economic Association, vol. 10(6), pages 1318-1347, December.
    5. Ottaviano, Gianmarco I.P. & Peri, Giovanni & Wright, Greg C., 2018. "Immigration, trade and productivity in services: Evidence from U.K. firms," Journal of International Economics, Elsevier, vol. 112(C), pages 88-108.
    6. Valeria Cirillo & Andrea Ricci, 2022. "Heterogeneity matters: temporary employment, productivity and wages in Italian firms," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 39(2), pages 567-593, July.
    7. Anna Maria Mayda, 2006. "Who Is Against Immigration? A Cross-Country Investigation of Individual Attitudes toward Immigrants," The Review of Economics and Statistics, MIT Press, vol. 88(3), pages 510-530, August.
    8. Giovanni Dosi & Dario Guarascio & Andrea Ricci & Maria Enrica Virgillito, 2021. "Neodualism in the Italian business firms: training, organizational capabilities, and productivity distributions," Small Business Economics, Springer, vol. 57(1), pages 167-189, June.
    9. Huber, Peter & Landesmann, Michael & Robinson, Catherine & Stehrer, Robert, 2010. "Migrants' Skills and Productivity: A European Perspective," National Institute Economic Review, National Institute of Economic and Social Research, vol. 213, pages 20-34, July.
    10. Fabiano Schivardi & Tom Schmitz, 2020. "The IT Revolution and Southern Europe’s Two Lost Decades [Lack of Selection and Limits to Delegation: Firm Dynamics in Developing Countries]," Journal of the European Economic Association, European Economic Association, vol. 18(5), pages 2441-2486.
    11. Gianmarco I.P. Ottaviano & Giovanni Peri, 2021. "The economic value of cultural diversity: evidence from US cities," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 7, pages 187-222, World Scientific Publishing Co. Pte. Ltd..
    12. Mari Kangasniemi & Matilde Mas & Catherine Robinson & Lorenzo Serrano, 2012. "The economic impact of migration: productivity analysis for Spain and the UK," Journal of Productivity Analysis, Springer, vol. 38(3), pages 333-343, December.
    13. repec:dau:papers:123456789/5382 is not listed on IDEAS
    14. Massimiliano Bratti & Chiara Conti, 2018. "The effect of immigration on innovation in Italy," Regional Studies, Taylor & Francis Journals, vol. 52(7), pages 934-947, July.
    15. Brunello, Giorgio & Lodigiani, Elisabetta & Rocco, Lorenzo, 2020. "Does low-skilled immigration increase profits? Evidence from Italian local labour markets," Regional Science and Urban Economics, Elsevier, vol. 85(C).
    16. Luca De Benedictis, 2005. "Three Decades of Italian Comparative Advantages," The World Economy, Wiley Blackwell, vol. 28(11), pages 1679-1709, November.
    17. Bettin, Giulia & Sacchi, Agnese, 2020. "Health spending in Italy: The impact of immigrants," European Journal of Political Economy, Elsevier, vol. 65(C).
    18. Nicodemo, Catia, 2013. "Immigration and Labor Productivity: New Empirical Evidence for Spain," IZA Discussion Papers 7297, Institute of Labor Economics (IZA).
    19. Parente, Paulo M.D.C. & Santos Silva, J.M.C., 2012. "A cautionary note on tests of overidentifying restrictions," Economics Letters, Elsevier, vol. 115(2), pages 314-317.
    20. Gianmarco Ottaviano & Giovanni Peri, 2013. "New Frontiers Of Immigration Research: Cities And Firms," Journal of Regional Science, Wiley Blackwell, vol. 53(1), pages 1-7, February.
    21. Francesc Ortega & Giovanni Peri, 2014. "The Aggregate Effects of Trade and Migration: Evidence from OECD Countries," Population Economics, in: Andrés Artal-Tur & Giovanni Peri & Francisco Requena-Silvente (ed.), The Socio-Economic Impact of Migration Flows, edition 127, pages 19-51, Springer.
    22. Christian Dustmann & Albrecht Glitz & Tommaso Frattini, 2008. "The labour market impact of immigration," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 24(3), pages 478-495, Autumn.
    23. M Daniele Paserman, 2013. "Do high-skill immigrants raise productivity? Evidence from Israeli manufacturing firms, 1990-1999," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-31, December.
    24. Giovanni Peri, 2016. "The Effect Of Immigration On Productivity: Evidence From U.S. States," World Scientific Book Chapters, in: The Economics of International Migration, chapter 8, pages 265-275, World Scientific Publishing Co. Pte. Ltd..
    25. De Arcangelis, Giuseppe & Di Porto, Edoardo & Santoni, Gianluca, 2015. "Migration, labor tasks and production structure," Regional Science and Urban Economics, Elsevier, vol. 53(C), pages 156-169.
    26. Carolyn Moehling & Anne Piehl, 2009. "Immigration, crime, and incarceration in early twentieth-century america," Demography, Springer;Population Association of America (PAA), vol. 46(4), pages 739-763, November.
    27. Christian Dustmann & Uta Schönberg & Jan Stuhler, 2016. "The Impact of Immigration: Why Do Studies Reach Such Different Results?," Journal of Economic Perspectives, American Economic Association, vol. 30(4), pages 31-56, Fall.
    28. Carlo Dell’Aringa & Claudio Lucifora & Laura Pagani, 2015. "Earnings differentials between immigrants and natives: the role of occupational attainment," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 4(1), pages 1-18, December.
    29. Myriam Quispe-Agnoli & Madeline Zavodny, 2002. "The effect of immigration on output mix, capital, and productivity," Economic Review, Federal Reserve Bank of Atlanta, vol. 87(Q1), pages 17-27.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Brunello, Giorgio & Lodigiani, Elisabetta & Rocco, Lorenzo, 2020. "Does low-skilled immigration increase profits? Evidence from Italian local labour markets," Regional Science and Urban Economics, Elsevier, vol. 85(C).
    2. Dr Max Nathan, 2013. "The wider economic impacts of high-skilled migrants: a survey of the literature," National Institute of Economic and Social Research (NIESR) Discussion Papers 413, National Institute of Economic and Social Research.
    3. Nathan, Max, 2013. "The Wider Economic Impacts of High-Skilled Migrants: A Survey of the Literature," IZA Discussion Papers 7653, Institute of Labor Economics (IZA).
    4. Sanchis-Guarner, Rosa, 2023. "Decomposing the impact of immigration on house prices," Regional Science and Urban Economics, Elsevier, vol. 100(C).
    5. Mariachiara Barzotto & Giancarlo Corò & Ilaria Mariotti & Marco Mutinelli, 2019. "Ownership and workforce composition: a counterfactual analysis of foreign multinationals and Italian uni-national firms," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 46(4), pages 581-607, December.
    6. Marcus H. Böhme & Sarah Kups, 2017. "The economic effects of labour immigration in developing countries: A literature review," OECD Development Centre Working Papers 335, OECD Publishing.
    7. Sanchis-Guarner, Rosa, 2014. "First-come first-served: identifying the demand effect of immigration inflows on house prices," LSE Research Online Documents on Economics 58341, London School of Economics and Political Science, LSE Library.
    8. Nathan, Max, 2013. "The Wider Economic Impacts of High-Skilled Migrants: A Survey of the Literature," IZA Discussion Papers 7653, Institute of Labor Economics (IZA).
    9. Wulong Gu & Feng Hou & Garnett Picot, 2020. "Immigration and firm productivity: evidence from the Canadian Employer-Employee Dynamics Database," Journal of Productivity Analysis, Springer, vol. 54(2), pages 121-137, December.
    10. Jens Ruhose, 2015. "Microeconometric Analyses on Economic Consequences of Selective Migration," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 61, March.
    11. Parisa Ghasemi & Paulino Teixeira & Carlos Carreira, 2024. "Immigrants and the Portuguese labor market: Threat or Advantage?," CeBER Working Papers 2024-02, Centre for Business and Economics Research (CeBER), University of Coimbra.
    12. Miguel Benítez Rueda, 2022. "Migración venezolana y productividad laboral en Colombia," Coyuntura Económica, Fedesarrollo, vol. 52, pages 35-64, December.
    13. Ivan Etzo & Carla Massidda & Paolo Mattana & Romano Piras, 2017. "The impact of immigration on output and its components: a sectoral analysis for Italy at regional level," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 34(3), pages 533-564, December.
    14. Rama Dasi Mariani & Alessandra Pasquini & Furio Camillo Rosati, 2023. "The Immigration Puzzle in Italy: A Survey of Evidence and Facts," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 9(1), pages 85-116, March.
    15. Chasapopoulos, Panagiotis, 2018. "The impact of international immigration and cultural diversity on economic performance, public attitudes and political outcomes in European regions," Other publications TiSEM d4a10f2a-c1a2-4edd-9887-2, Tilburg University, School of Economics and Management.
    16. Alacevich, Caterina & Nicodemo, Catia, 2019. "Immigration and Work-Related Injuries: Evidence from Italian Administrative Data," IZA Discussion Papers 12510, Institute of Labor Economics (IZA).
    17. Barone, Guglielmo & D'Ignazio, Alessio & de Blasio, Guido & Naticchioni, Paolo, 2016. "Mr. Rossi, Mr. Hu and politics. The role of immigration in shaping natives' voting behavior," Journal of Public Economics, Elsevier, vol. 136(C), pages 1-13.
    18. Barone, Guglielmo & D'Ignazio, Alessio & de Blasio, Guido & Naticchioni, Paolo, 2016. "Mr. Rossi, Mr. Hu and politics. The role of immigration in shaping natives' voting behavior," Journal of Public Economics, Elsevier, vol. 136(C), pages 1-13.
    19. Sekou Keita & Thomas Renault & Jérôme Valette, 2024. "The Usual Suspects: Offender Origin, Media Reporting and Natives’ Attitudes Towards Immigration," The Economic Journal, Royal Economic Society, vol. 134(657), pages 322-362.
    20. Stelios Roupakias & Michael Chletsos, 2020. "Immigration and far-right voting: evidence from Greece," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 65(3), pages 591-617, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:worlde:v:47:y:2024:i:2:p:590-617. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0378-5920 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.