Junior Migration Webinar

The Impact of Immigration on Workers Protection

avec Riccardo Turati

Abstract

Even though the current literature investigating the labor market impact of immigration assumes implicitly or explicitly labor market regulation as exogenous to immigration (both in terms of size and composition) - this is not necessarily the case. This paper shows that the composition of the immigrant population affects the degree of workers protection over a sample of 70 developed and developing countries from 1970 to 2010. After building a workers protection index based on 36 labor law variables and exploiting a dynamic panel setting using both internal and external instruments, we find that migrants impact the destination countries' workers protection mainly through the degree of workers protection experienced in their origin countries, captured by an "epidemiological" effect. On the other hand, the size of the immigrant population has a small and rather insignificant effect. The results are robust to alternative and competing immigration effects such as diversity, polarization and skill-selection. The effects are particularly strong across two dimensions of the workers protection index: worker representation laws and employment forms laws. This paper provides suggestive evidence that immigrants' participation to unions and its implications for the political actors is one of the potential mechanisms through which the epidemiological effect could materialize. Finally, calculations based on the estimated coefficients suggest that immigration contributes to a reduction of the degree of workers protection, particularly in OECD high-income countries.

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