The Abolition of Immigration Restrictions and the Performance of Firms and Workers: Evidence from Switzerland
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Andreas Beerli
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Jan Ruffner
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Michael Siegenthaler
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Giovanni Peri
- American Economic Review (Forthcoming)
Abstract
We study a reform that granted European cross-border workers free access to the Swiss
labor market and had a stronger effect on regions close to the border. The greater availability
of cross-border workers increased foreign employment substantially. Although many crossborder
workers were highly educated, wages of highly educated natives increased. The reason
is a simultaneous increase in labor demand: the reform increased the size, productivity, and
innovation performance of skill-intensive incumbent firms and attracted new firms, creating
opportunities for natives to pursue managerial jobs. These effects are mainly driven by firms
that reported skill shortages before the reform.
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