Computerization and immigration: Theory and evidence from the United States | Zendy

Basso Gaetano | Zendy; Peri Giovanni | Zendy; Rahman Ahmed S. | Zendy

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Computerization and immigration: Theory and evidence from the United States

Author(s) -

Basso Gaetano,

Peri Giovanni,

Rahman Ahmed S.

Publication year - 2020

Publication title -

canadian journal of economics/revue canadienne d'économique

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 0.773

H-Index - 69

eISSN - 1540-5982

pISSN - 0008-4085

DOI - 10.1111/caje.12472

Subject(s) - immigration , technological change , openness to experience , labour economics , economics , welfare , productivity , wage , labor demand , polarization (electrochemistry) , demographic economics , economic growth , political science , market economy , macroeconomics , psychology , social psychology , chemistry , law

Recent technological changes have been characterized as “routine‐substituting” because they reduce demand for routine tasks and increase demand for analytical and service tasks. Little is known about how these changes have impacted immigration, or task specialization between immigrants and native‐born individuals. In this paper, we show that such technological progress has attracted immigrants who increasingly specialize in manual‐service occupations. We also suggest that openness to immigration attenuated the job and wage polarization faced by native‐born from technological changes. We explain these facts with a model of technological progress and endogenous immigration. Simulations show that unskilled immigration attenuates the drop in routine employment proceeding from technological change, enhances skill upgrading for native‐born and raises economy‐wide productivity and welfare.

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