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Immigration and structural change: Evidence from post-war Germany

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  • Braun, Sebastian
  • Kvasnicka, Michael

Abstract

Does immigration accelerate sectoral change from low- to high-productivity sectors? This paper analyzes the effect of one of the largest population movements in history, the influx of millions of German expellees to West Germany after World War II, on Germany's speed of transition away from low-productivity agriculture. A simple two-sector specific factor model, in which moving costs prevent the marginal product of labor to be equalized across sectors, predicts that expellee inflows boost output per worker by expanding the high-productivity non-agricultural sector but decrease output per worker within sectors. Using German district-level data from before and after the war, we find empirical support for these predictions.

Suggested Citation

  • Braun, Sebastian & Kvasnicka, Michael, 2014. "Immigration and structural change: Evidence from post-war Germany," Journal of International Economics, Elsevier, vol. 93(2), pages 253-269.
    • Handle: RePEc:eee:inecon:v:93:y:2014:i:2:p:253-269
    DOI: 10.1016/j.jinteco.2014.03.006
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    More about this item

    Keywords

    Immigration; Sectoral change; Output growth; Post-war Germany;
    All these keywords.

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • C36 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Instrumental Variables (IV) Estimation
    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-

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