Abstract
The Macroeconomic Effects of Immigration: Israel in the 1990s. — The authors perform counterfactual simulations using an econometric model to estimate the macroeconomic effects of immigration in Israel. The model takes account of immigrant assimilation in labor and housing markets. They argue that wage flexibility was the key to success in immigrant absorption. In addition, the animal spirits of entrepreneurs consolidated this success. House prices, GDP, consumption, investment, unemployment and imports would have been considerably lower but for the immigration, while real wages would have been higher. The main beneficiaries were capitalists owning housing and businesses. The main losers were workers who were not owner-occupiers.
Zusammenfassung
Die makroökonomischen Effekte der Immigration: Israel in den neunziger Jahren. — Die Autoren verwenden ein ökonometrisches Modell und führen Simulationen durch, um die makroökonomischen Effekte der Immigration in Israel zu schätzen. Das Modell trägt der Assimilation der Immigranten auf den Arbeits- und Wohnungsmärkten Rechnung. Die Autoren zeigen, daß die Flexibilität der Löhne der Schlüssel zur erfolgreichen Absorption der Immigranten ist. Die Vitalität der Unternehmer hat diesen Erfolg konsolidiert. Immobilienpreise, BIP, Konsum, Investitionen, Arbeitslosigkeit und Importe wären ohne Immigration deutlich niedriger gewesen, während die Reallöhne höher gewesen wären. Die Hauptnutznießer der Immigration und Absorption waren die Kapitalisten, die Häuser und Geschäfte besitzen. Die Hauptverlierer waren Arbeiter, die nicht Eigentümer ihrer Wohnungen und Häuser sind.
This is a preview of subscription content, log in via an institution to check access.
Similar content being viewed by others
References
Bahral, U. (1965).The Effect of Mass Immigration on Wages in Israel. The Maurice Falk Institute for Economic Research in Israel, Jerusalem.
Bar-Nathan, M., M. Beenstock, and Y. Haitovsky (1997). The Market for Housing in Israel.Regional Science and Urban Economics, forthcoming.
Beenstock, M. (1997). Business Output in the Short and Long Run in Israel.Journal of Productivity Analysis 8:53–70.
Beenstock, M., and I. Ben-Menahem (1997). The Labor Market Absorption of Immigrants from the Former USSR: Israel 1989–1994.International Migration, forthcoming.
Beenstock, M., and S. Ribon (1993). The Market for Labour in Israel.Applied Economics 25:971 -982.
Beenstock, M., Y. Lavi, and A. Offenbacher (1994). A Macroeconometric Model of the Israeli Economy 1960–1989.Economic Modelling 11:413–462.
Beenstock, M., Y. Lavi, and S. Ribon (1994). The Supply and Demand for Exports in Israel.Journal of Development Economics 44:330–350.
Beenstock, M., J. Metzer, and S. Ziv (1995). Immigration and the Jewish Economy in Mandatory Palestine: An Econometric Investigation.Research in Economic History 15:149–214.
Blanchard, O. J., and L. F. Katz (1992). Regional Evolutions.Brookings Papers on Economic Activity (1): 1–61.
Borjas, G. S. (1994). The Economics of Immigration.Journal of Economic Literature 32:1667–1717.
— (1995). The Economic Benefits from Immigration.Journal of Economic Perspectives 9:2–22.
Brezis, E. S., and P. Krugman (1996). Immigration, Investment and Real Wages.Journal of Population Economics 9:83–94.
Chiswick, B. S. (1993). Hebrew Language Usage: Determinants and Effects on Earnings of Immigrants in Israel. Department of Economics, University of Illinois at Chicago, mimeo.
De New, J., and K. F. Zimmermann (1994). Native Wage Impacts of Foreign Labour: A Random Effects Panel Analysis.Journal of Population Economics 7:177–192.
Dolado, J., A. Goria, and A. Ichino (1994). Immigration, Human Capital and Growth in the Host Country: Evidence from Pooled Country Data.Journal of Population Economics 7:193–216.
Ericsson, N., and J. S. Irons (1995). The Lucas Critique in Practice: Theory without Measurement. In K. D. Hoover (ed.),Macroeconometrics: Developments, Tensions and Prospects. Boston: Kluwer Academic.
Franz, W., U. Oser, and M. Winker (1994). A Macroeconomic Disequilibrium Analysis of Current and Future Migration from Eastern Europe into West Germany.Journal of Population Economics 7:217–234.
Friedberg, R. M. (1995) You Can’t Take It with You? Immigrant Assimilation and the Portability of Human Capital: Evidence from Israel. Discussion Paper 95.02. The Maurice Falk Institute for Economic Research in Israel, Jerusalem.
- (1996). The Impact of Mass Migration on the Israeli Labor Market. Brown University, May, mimeo.
Friedberg, R. M., and J. Hunt (1995). The Impact of Immigrants on Host Country Wages, Employment and Growth.Journal of Economic Perspectives 9:23–44.
Hatton, T. J., and J. G. Williamson (1995). The Impact of Immigration on American Labor Markets Prior to the Quotas. Working Paper 5185. National Bureau of Economic Research.
Kuznets, S. (1973). The Economic Development of Israel.Economic Quarterly 20 (September): 189–209. (Hebrew).
Lavi, Y. (1990a). The Effects of Interest Rates on Business Investment in Israel: 1962–1987.Economic Quarterly 37:343–368. (Hebrew).
- (1990 b). The Effects of Interest Rates on Private Consumption in a Traditional Model and a Rational Expectations Model: Empirical Findings 1962–1988. Discussion Paper 90.08. Bank of Israel, Research Department. (Hebrew).
O’Rourke, K., J. G. Williamson, and T. J. Hatton (1995). Mass Migration, Commodity Market Integration and Real Wage Convergence: The Late-Nineteenth-Century Atlantic Economy. In T. J. Hatton and J. G. Williamson (eds.),Migration and the International Labor Market 1850–1939. London: Routledge.
Pagan, A. R. (1994). Calibration and Econometric Research: an Overview.Journal of Applied Econometrics 9:51–72.
Pope, D., and G. Withers (1995). Wage Effects of Immigration in Late-Nineteenth-Century Australia. In T. J. Hatton and J. G. Williamson (eds.),Migration and the International Labor Market 1850–1939. London: Routledge.
About this article
Cite this article
Beenstock, M., Fisher, J. The macroeconomic effects of immigration: Israel in the 1990s. Weltwirtschaftliches Archiv 133, 330–358 (1997). https://doi.org/10.1007/BF02707467
Published:
Issue Date:
DOI: https://doi.org/10.1007/BF02707467