Residential Location, Work Location, and Labor Market Outcomes Of
Residential Location, Work Location, and Labor Market Outcomes of Immigrants In Israel∗ Moshe Buchinsky UCLA, NBER and CREST-INSEE Chemi Gotlibovski The Academic College of Tel Aviv Yafo This Version: February, 2008 First Version: February, 2007 ∗This research was supported by the ISF under grant No. 811/02. We thank Yoram Weiss for insightful comments and discussion, to Robert Sauer for help at the early stages of this project, and to Corinne Parenti-Sauer for helping us with processing the data. We also thank seminar participants at INSEE-CREST, Toulouse, UCL, LSE, Hebrew University of Jerusalem, Haifa University, Bar-Ilan University, Tel Aviv University, and CERGE-EI, for useful comments and suggestions. 1Introduction Internal migration and immigration are two important mechanisms by which market economies adjust to changing economic conditions and achieve optimal allocation of resources. An influx of new workers to a particular region, be they new immigrants or internal migrants, can help equilibrate the labor market and improve the interregional allocation of resources. Perhaps due to frictions which prevent the free flow of labor, national policies aimed at facilitating the arrival of new workers to different regions of a country are now widespread. Governments often subsidize the relocation expenses of internal migrants, subsidize mortgages, and help in creating employment exchanges which advertise job openings nationally. The purpose of this paper is to empirically examine the effect of national migration policy on the regional location choices and labor market outcomes of migrant workers. As a particular case study, we focus on measuring the consequences of the Israeli government’s intervention in the housing market on the labor market outcomes of new immigrants from the former Soviet Union.
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