Bratti, Massimiliano De Benedictis, Luca Santoni, Gianluca
Year of Publication:
Discussion Paper series, Forschungsinstitut zur Zukunft der Arbeit 6628
In this paper we investigate the causal effect of immigration on trade flows, using Italian panel data covering very small geographical units (NUTS-3). Exploiting the very favorable setup offered by Italy's features - the very high number of countries of origin of immigrants ('super-diversity'), the high heterogeneity of social and economic characteristics of Italian provinces coupled with the absence of cultural (e.g. language) or historical (colonial ties) attractors for immigration -, controlling for a wide set of fixed effects, and dealing with the possible distortions generated by the inappropriate choice of the areal unit, we find a positive association between immigrants' stocks and both export and import flows, in line with the past literature. However, using instrumental variables based on migration enclaves, we show that immigrants have a positive and significant effect on imports only.
migration trade gravity model super-diversity MAUP transplanted-home bias effect business and social networks effects