Just go to the thread on HN discussing their Nobel Prize. They're most known for their study on Cuban migrants to Miami, where many migrants came and wages didn't fall.
Many, many economists cite this study to say that immigration doesn't reduce wages. And it is true, often. However it's not because an influx of workers doesn't create downward pressure on wages. It's because there's other factors which keep wages rising.
Now in Canada we have a situation where our immigration levels are so high that we don't even pretend it doesn't affect wages anymore.
>However it's not because an influx of workers doesn't create downward pressure on wages. It's because there's other factors which keep wages rising.
So one of the main theories about that paper is that the immigrants were in a largely separate labor market in terms of skills/experience from local workers. When they raised the labor supply in their particular market, it increased entreprenurial activity and more labor was hired across many labor markets as a result.
I got you. Yeah, reduced form models will have the issue of disentangling factors. This is why diff-in-diff and synthetic control models are valuable, but identification assumptions have to be clear.
So one of the main theories about that paper is that the immigrants were in a largely separate labor market in terms of skills/experience from local workers. When they raised the labor supply in their particular market, it increased entreprenurial activity and more labor was hired across many labor markets as a result.