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Essays on immigrants and their impact on the local labour market Mukherji, Ronit


The first chapter studies how low-skilled immigrant entry can explain the falling labour unionization rate in the U.S. economy. This paper argues that the entry of immigrants has significantly altered the incentives of native-born workers to join labour unions and for firms to hire unionized workers, prompting a fall in unionization. The chapter uses spatial variation in immigrant entry to show that a higher entry of immigrants leads to a higher fall in unionization rates across regions in the U.S. It develops a search-theoretic framework to bear out the mechanism and test some over-identifying predictions. The model is further calibrated and finds that low-skilled immigrant entry can explain 48-55% of the total fall in union density. The second chapter exploits plausibly exogenous changes in exchange rates across source countries for immigrants in Canada to evaluate how these changes impact their earnings. It presents evidence that Canadian immigrants, in response to a 10 per cent depreciation of the home currency relative to the Canadian dollar, reduce their annual earnings by 0.36 per cent, mainly by reducing hours worked. The effect is greater for recent male immigrants, who are less educated and their spouses abroad. They also tend to be from lower-income countries and located in immigrant enclaves. Crucially, remittance senders are more affected, but these exchange rate fluctuations do not affect the amount of remittance sent. Thus, suggesting that immigrants tend to be target earners and react accordingly to exchange rate fluctuations. The third chapter examines how immigrants' labour market conditions at the point of entry affect their earnings, labour market outcomes, and reverse migration decisions both in the short and long run. Using administrative tax data, this chapter finds that it takes 12-15 years for an initial adverse effect of entering the labour market when unemployment is high to dissipate completely. It further documents the heterogeneity existing in this impact based on age, gender, marital status, country of origin, and education. The chapter provides novel insights into the outmigration behaviour of immigrants and how it depends on the initial conditions they face post-arrival.

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