NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Immigration, Offshoring and American Jobs

Gianmarco I.P. Ottaviano, Giovanni Peri, Greg C. Wright

NBER Working Paper No. 16439
Issued in October 2010
NBER Program(s):   ITI   LS

How many "American jobs" have U.S.-born workers lost due to immigration and offshoring? Or, alternatively, is it possible that immigration and offshoring, by promoting cost-savings and enhanced efficiency in firms, have spurred the creation of jobs for U.S. natives? We consider a multi-sector version of the Grossman and Rossi-Hansberg (2008) model with a continuum of tasks in each sector and we augment it to include immigrants with heterogeneous productivity in tasks. We use this model to jointly analyze the impact of a reduction in the costs of offshoring and of the costs of immigrating to the U.S. The model predicts that while cheaper offshoring reduces the share of natives among less skilled workers, cheaper immigration does not, but rather reduces the share of offshored jobs instead. Moreover, since both phenomena have a positive "cost-savings" effect they may leave unaffected, or even increase, total native employment of less skilled workers. Our model also predicts that offshoring will push natives toward jobs that are more intensive in communication-interactive skills and away from those that are manual and routine intensive. We test the predictions of the model on data for 58 U.S. manufacturing industries over the period 2000-2007 and find evidence in favor of a positive productivity effect such that immigration has a positive net effect on native employment while offshoring has no effect on it. We also find some evidence that offshoring has pushed natives toward more communication-intensive tasks while it has pushed immigrants away from them.

download in pdf format
   (528 K)

email paper

This paper is available as PDF (528 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w16439

Published: Gianmarco I. P. Ottaviano & Giovanni Peri & Greg C. Wright, 2013. "Immigration, Offshoring, and American Jobs," American Economic Review, American Economic Association, vol. 103(5), pages 1925-59, August. citation courtesy of

Users who downloaded this paper also downloaded these:
Ottaviano and Peri w14188 Immigration and National Wages: Clarifying the Theory and the Empirics
Caballero w16429 Macroeconomics after the Crisis: Time to Deal with the Pretense-of-Knowledge Syndrome
Peri w15507 The Effect of Immigration on Productivity: Evidence from US States
Cohen and Malloy w16437 Friends in High Places
Ottaviano and Peri w12497 Rethinking the Effects of Immigration on Wages
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us