Institutional Affiliation: ETH Zurich
|The Abolition of Immigration Restrictions and the Performance of Firms and Workers: Evidence from Switzerland|
with , , : w25302
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 cross-border 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.
|The Labor Market Effects of Opening the Border: Evidence from Switzerland|
with : w21319
Between 1999 and 2004 Switzerland opened its border region (BR) to cross-border workers (CBW), who are foreign residents commuting to Switzerland for work. In this paper, we exploit the timing of implementation and the fact that CBW commute almost exclusively to municipalities close to the border to estimate the effect of this policy on foreign labor supply and on native labor market outcomes, using a difference-in-difference approach. We find that opening the border to CBW increased their employment within 20 minutes of commuting time from the border by four to five percentage points. The increased inflow was constituted of highly-educated workers and it was associated with an increase in wages for highly-educated Swiss workers. Native highly-educated workers became more likely to fill to...