Mardi 12 mars 2019 — Séminaire DYNAMICS

Massimo Anelli (Bocconi University)
Youth Drain, Entre­pre­neur­ship and Inno­va­tion (travail conjoint avec Gaetano Basso, Giuseppe Ippe­dico et Giovanni Peri)

Busi­ness dyna­mism and inno­va­tion are often embo­died in young gene­ra­tions who bring new ideas and trans­form the produc­tive and orga­ni­za­tional struc­ture of compa­nies. What happens to an economy if the cohort of young people shrinks signi­fi­cantly in size ? In this paper we exploit a sudden increase in emigra­tion of young Italians during the period 2010–2015 and analyze its effects on firm crea­tion and inno­va­tion. As the deci­sion to emigrate is partly driven by local economic condi­tions, we isolate its « pull-driven » component to reduce endo­ge­neity and omitted variable issues. We combine such varia­tion with detailed firm-level data on the universe of Italian firms and find that youth emigra­tion is asso­ciated with lower firm crea­tion, fewer inno­va­tive start-ups and a decline in skill inten­sity in the local economy.

The matching between firm and workers is an impor­tant mecha­nism affec­ting average produc­ti­vity and its disper­sion. Denser and more diver­si­fied labor markets may encou­rage posi­tive assor­ta­tive matching which in turn increases average produc­ti­vity, average wages and profits in the area. We think of immi­gra­tion as increa­sing the range of skills and the « thick­ness » of local labor markets. This may increase the returns to doing scree­ning for firms, which increases the extent of posi­tive assor­ta­tive matching. Using French matched employer-employee (DADS) data we docu­ment a novel fact about the hiring deci­sion of French firms. Posi­tive changes in the local supply of immi­grant workers improves the matching between workers and firms captured by a stronger rank corre­la­tion in the firm-worker types. We show that this asso­cia­tion may be causal. This is a further channel through which immi­grants may be bene­fi­cial to local produc­ti­vity and it contri­butes to explain the lack of nega­tive effects from immi­gra­tion on wage of natives.