Abstract
The relevance of residential segregation and ethnic enclaves for labor market sorting of immigrants has been investigated by a large body of literature. Previous literature presents competing arguments and mixed results for the effects of segregation and ethnic concentration on various labor market outcomes. The geographical size of the area at which segregation and/or ethnic concentration is measured, however, is left to empirical work to determine. We argue that ethnic concentration and segregation should not be used interchangeably, and more importantly, the geographical area at which they are measured relates directly to different mechanisms. We use a probabilistic approach to identify the likelihood that an immigrant is employed or a self-employed entrepreneur in the year 2005 with respect to residential segregation and ethnic concentration at the level of the neighborhood, municipality, and local labor market level jointly. We study three groups of immigrants that accentuate the differences between forced and pulled migrants: (i) the first 15 member states of European Union (referred to as EU 15) and the Nordic countries, (ii) the Balkan countries, and (iii) countries in the Middle East. We find that ethnic enclaves, proxied by ethnic concentration at varying levels, indicate mixed results for the different immigrant groups we study, both for their employment and entrepreneurship probability, whereas residential segregation has a more uniformly distributed result where its relationship to any of the two labor market outcomes is almost always negative or insignificant.
Highlights
Migration to Europe is not a recent phenomenon
We find that ethnic enclaves, proxied by ethnic concentration at varying levels, indicate mixed results for the different immigrant groups we study, both for their employment and entrepreneurship probability, whereas residential segregation has a more uniformly distributed result where its relationship to any of the two labor market outcomes is almost always negative or insignificant
We argue that the variation in the employment or entrepreneurship outcome that originates from the measurement of ethnic concentration, residential segregation, and from the choice of geographical aggregation is not random
Summary
Migration to Europe is not a recent phenomenon. But the historically high rates at which many European countries have received refugees from parts of Middle East during the recent years has raised the concerns for the integration of immigrants dramatically. Peers of a particular ethnic or cultural group collocate in close proximity to each other and residentially segregated from the natives These two empirical regularities, which are often referred to as ethnic enclaves and segregation in the literature, have serious policy implications and are at the fore in the political discourse about immigration in many European countries. The literature on ethnic concentration and residential segregation is extensive, there is no consensus about their effect on immigrants’ labor market outcomes. We argue that the variation in the employment or entrepreneurship outcome that originates from the measurement of ethnic concentration, residential segregation, and from the choice of geographical aggregation is not random. By way of this paper, we contribute to the literature by investigating the relevance of such geographical layering for employment and entrepreneurship prospects of immigrants using Sweden as a case, and we display how results systematically differ between ethnic concentration and segregation at various geographical levels
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