Immigration, unemployment and GDP in the host country: Bootstrap panel Granger causality analysis on OECD countries

• Main Authors: Boubtane, Ekrame, Coulibaly, Dramane, Rault, C.
• Other Authors: Centre d'Études et de Recherches sur le Développement International (CERDI), Université d'Auvergne - Clermont-Ferrand I (UdA)-Centre National de la Recherche Scientifique (CNRS), EconomiX (EconomiX), Université Paris Nanterre (UPN)-Centre National de la Recherche Scientifique (CNRS), Laboratoire d'Économie d'Orleans UMR7322 (LEO), Université d'Orléans (UO)-Université de Tours (UT)-Centre National de la Recherche Scientifique (CNRS)
• Format: Report
• Language: English
• Published: HAL CCSD 2013
• Subjects: immigration; growth; Unemployment; Granger causality; JEL: E - Macroeconomics and Monetary Economics/E.E2 - Consumption; Saving; Production; Investment; Labor Markets; and Informal Economy/E.E2.E20 - General; JEL: F - International Economics/F.F2 - International Factor Movements and International Business/F.F2.F22 - International Migration; JEL: J - Labor and Demographic Economics/J.J6 - Mobility; Vacancies; and Immigrant Workers/J.J6.J61 - Geographic Labor Mobility • Immigrant Workers; [SHS.ECO]Humanities and Social Sciences/Economics and Finance; Norway; Iceland
• Online Access: https://shs.hal.science/halshs-00827003; https://shs.hal.science/halshs-00827003/document; https://shs.hal.science/halshs-00827003/file/2013.03.pdf

This paper examines the causality relationship between immigration, unemployment and economic growth of the host country. We employ the panel Granger causality testing approach of Konya (2006) that is based on SUR systems and Wald tests with country specific bootstrap critical values. This approach allows to test for Granger-causality on each individual panel member separately by taking into account the contemporaneous correlation across countries. Using annual data over the 1980-2005 period for 22 OECD countries, we find that, only in Portugal, unemployment negatively causes immigration, while in any country, immigration does not cause unemployment. On the other hand, our results show that, in four countries (France, Iceland, Norway and the United Kingdom), growth positively causes immigration, whereas in any country, immigration does not cause growth.