Diego Marino Fages (University of Nottingham)

Migration and Trust: Evidence from Internal Migrants in Switzerland

Abstract

I study whether internal migrants assimilate culturally to the locals. Investigating this question with observational data has been challenging because it requires disentangling assimilation from sorting and because data on immigrants before migrating is typically not available. I overcome this challenge by studying the Swiss context, which provides an ideal setting for two reasons. First, as a result of its history, Switzerland presents substantial cultural differences between its regions. Second, the Swiss Household Panel tracks individuals for a long period before and after they move. I exploit these two features to compare early and late migrants in a difference-in-difference framework. I focus specifically on trust in strangers, one of the most important components of culture and which has been shown to predict growth and other desirable economic, social and political outcomes. I find a statistically and economically significant evidence on assimilation of migrants moving to higher and lower trust cantons, and this assimilation happens in the first few years. Finally, using the Sorted Effects Method, I find that assimilation is driven by the youngest immigrants, which is in line with the impressionable years hypothesis in psychology.

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