The Employment Effects of Immigration: Evidence from the Mass Arrival of German Expellees in Post-war Germany By Sebastian Braun and Toman Omar Mahmoud No. 1725| August 2011 Kiel Institute for the World Economy, Hindenburgufer 66, 24105 Kiel, Germany Kiel Working Paper No. 1725 | August 2011 The Employment Effects of Immigration: Evidence from the Mass Arrival of German Expellees in Post-war Germany* Sebastian Braun and Toman Omar Mahmoud Abstract: This paper studies the employment effects of the influx of millions of German expellees to West Germany after World War II. The expellees were forced to relocate to post-war Germany. They represented a complete cross-section of society, were close substitutes to the native West German population, and were very unevenly distributed across labor market segments in West Germany. We find a substantial negative effect of expellee inflows on native employment. The effect was, however, limited to labor market segments with very high inflow rates. IV regressions that exploit variation in geographical proximity and in pre-war occupations confirm the OLS results. Keywords: Forced migration, native employment, post-war Germany JEL classification: J61, J21, C36 Sebastian Braun Kiel Institute for the World Economy Telephone: +49 431 8814 482 E-mail:
[email protected] Toman Omar Mahmoud Kiel Institute for the World Economy Telephone: +49 431 8814 471 E-mail:
[email protected] * We thank Eckhardt Bode, Michael C. Burda, Michael Kvasnicka, Alexandra Spitz-Oener, Andreas Steinmayr, Nikolaus Wolf and participants of research seminars in Berlin and Kiel for helpful comments and discussions. Martin Müller-Gürtler and Richard Franke provided excellent research assistance.