THE EFFECT OF IMMIGRATION ON AGGREGATE NATIVE UNEMPLOYMENT - AN ACROSS-CITY ESTIMATION

This study investigates the relationship between the rate of immigration into various cities in various years and the level and change in unemployment. In pooled regressions, immigration lagged one year does not show a statistically significant effect either by itself or when other lags are added. Individual regressions using the difference in unemployment rates over time show a slight, but statistically insignificant, positive displacement effect over two-year periods. The evidence indicates that there is little or no observed increase in aggregate native unemployment due to immigration, even in the relatively short run during which adjustment frictions should be most severe.