"Life among the lowly": measuring the effect of immigration on the destination country

"Life among the lowly" is the XIX century best-seller which strongly con- tributed to the anti-slavery movement. Certainly, it denounced the life and labour conditions of black slaves, but it also inspired some stereotypes on black people that still survive today. These two faces of the novel are contained in the present dissertation. The first chapter "Hate at First Sight? Dynamic Aspects of the Electoral Impact of Migrations: the Case of the UK and Brexit" analyses how native political preferences are influenced by the presence of foreigners in a neighbourhood. The last European and U.S. election campaigns hinged on the migration issue and we argue that the preferences expressed through the vote might reflect some prejudicial attitudes. Instead, the second and third chapters refer to the impact of immigration on the domestic labour market. "Need for Flexibility or Subsidies? Reviewing the Impact of Immigration on the Domestic Labour Market" reviews all the seminal papers that have contributed to understand the effect of immigrant workers on native labour market conditions. The conclusion of this literature sustains a non negative impact of foreign labour supply on native average wage. According to these studies this effect is achieved more easily when the labour market is flexible and workers can nimbly change their occupations. Nonetheless, the crucial hypothesis of all the analysis is a perfect elastic capital supply. Studies on the reaction of investments to an increase in the immigrant labour-force are still rather scant and we try to improve the knowledge on the underlying dynamics in the last chapter. "The Labour Demand Response to Supply Shocks. The Indirect Effect of Immigration" investigates how industries and firms production decisions are influenced by migration inflows. The general conclusion, as suggested by the title of the review, is that policy makers should pay attention to industrial policies and not only to labour market structure. In particular, previous studies on the impact of foreign-born population on native voting preferences have highlighted a positive effect of immigration on the electoral consensus for right-wing parties. Nonetheless, this result holds with some caveats. To overcome the limit of the existing literature we formulate the hypothesis that an anti-immigrant attitude rises only at the arrival of the migration inflows and disappears some period later. At the basis of such a dynamics there could be material concerns about the adjustment costs of the new population or some prejudices, both denoting an "hate at first sight effect". To measure this potential mechanism we use an approach based on the standard network instrument which robustly supports our hypothesis. With regard to the analysis on the labour market, neglecting the reaction of investments to an increase in the labour supply can lead to some mislead- ing policy conclusions. Our contribution to the literature is to explicitly looking at the labour demand side of the market. Furthermore, contrary to the existing studies, the data that we use allow us to conduct the analysis at the firm level. We then avoid the bias that originates from the heterogene- ity of production units within industries. The data refer to an important case-study such that of Italy. Although it is only a landing country for most migrants, inflows increased tremendously from 2007, deserving a specific at- tention from academics. The result of the empirical analysis – conducted by means of the network instrument – highlights that immigrant labour- force has been largely absorbed by the adoption of more labour-intensive technologies. The layout with which we present the different studies depicts the order of priorities that in our opinion policy makers should follow. From the very beginning of the refugee crisis the economic analysis has been used in order to find political answers. Public attitudes in favour of solidarity have been linked to the ability of the market in absorbing the population shock. In doing that few attention has been given to the potential effect of the phe- nomenon on the political stability and social cohesion. On the contrary, we expect that public actors would build a community around shared values and consequently design the policies to overcome the market failures.