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Why to employ both migrants and natives? A study on task-specific substitutability

Author

Listed:
  • Anette Haas

    (Institut für Arbeitsmarkt- und Berufsforschung (IAB))

  • Michael Lucht

    (Institut für Arbeitsmarkt- und Berufsforschung (IAB))

  • Norbert Schanne

    (Institut für Arbeitsmarkt- und Berufsforschung (IAB))

Abstract
This paper analyzes the performance of migrants on the German labor market and its dependence on the tasks performed on their jobs. Recent work suggests quantifying the imperfect substitutability relationship between migrants and natives as a measure for the hurdles migrants have to face. Our theoretical work adopts that migrant shares are very heterogeneous across firms which is hard to reconcile with an aggregate production function. We argue that the ability to integrate migrants may form a competitive advantage for firms. We show in a Melitz-type framework that the output reaction to wage changes varies across firms. Hence, substitution elasticities of an aggregate production function can be quite different from those individual firms are faced with. Finally we estimate elasticities of substitution for different aggregate CES-nested production functions for Germany between 1993 and 2008 using administrative data and taking into account the task approach. We find significant variation in the substitutability between migrants and natives across qualification levels and tasks. We show that especially interactive tasks seem to impose hurdles for migrants on the German labor market.

Suggested Citation

  • Anette Haas & Michael Lucht & Norbert Schanne, 2012. "Why to employ both migrants and natives? A study on task-specific substitutability," Norface Discussion Paper Series 2012026, Norface Research Programme on Migration, Department of Economics, University College London.
    • Handle: RePEc:nor:wpaper:2012026
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    Cited by:

    1. Jaschke Philipp & Sulin Sardoschau & Marco Tabellini, 2021. "Scared Straight? Threat and Assimilation of Refugees in Germany," RF Berlin - CReAM Discussion Paper Series 2136, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    2. Nancy Kracke & Margarida Rodrigues, 2020. "A Task-Based Indicator for Labour Market Mismatch," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 149(2), pages 399-421, June.
    3. Lucht, Michael & Haas, Anette, 2015. "The productivity effect of migrants : wage cost advantages and heterogeneous firms," IAB-Discussion Paper 201505, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    4. Philipp Jaschke & Sulin Sardoschau & Marco Tabellini, 2023. "Scared Straight? Threat and Assimilation of Refugees in Germany," Rationality and Competition Discussion Paper Series 384, CRC TRR 190 Rationality and Competition.
    5. Eduard Storm, 2022. "Task specialization and the Native‐Foreign Wage Gap," LABOUR, CEIS, vol. 36(2), pages 167-195, June.
    6. Ingwersen, Kai & Thomsen, Stephan L., 2020. "An Empirical Assessment of Workload and Migrants' Health in Germany," IZA Discussion Papers 13962, Institute of Labor Economics (IZA).
    7. Dengler, Katharina & Matthes, Britta & Paulus, Wiebke, 2014. "Occupational Tasks in the German Labour Market : an alternative measurement on the basis of an expert database," FDZ Methodenreport 201412_en, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    8. Peters, Cornelius, 2015. "Do age complementarities affect labour productivity? Evidence from German firm level data," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112941, Verein für Socialpolitik / German Economic Association.
    9. Storm, Eduard, 2021. "Task specialization and the native-foreign wage gap: Evidence from worker-level data," Ruhr Economic Papers 928, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    10. repec:iab:iabfme:201412(en is not listed on IDEAS
    11. repec:iab:iabfme:201412(de is not listed on IDEAS
    12. Tobias Maier, 2022. "Change in occupational tasks and its implications: evidence from a task panel from 1973 to 2011 for Western Germany," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(3), pages 889-921, June.
    13. Dengler, Katharina & Matthes, Britta & Paulus, Wiebke, 2014. "Berufliche Tasks auf dem deutschen Arbeitsmarkt : eine alternative Messung auf Basis einer Expertendatenbank (Occupational Tasks in the German Labour Market : an alternative measurement on the basis o," FDZ Methodenreport 201412_de, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

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    More about this item

    Keywords

    Heterogeneity; Migrants; Substitution Elasticity; Tasks;
    All these keywords.

    JEL classification:

    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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