Where do immigrants settle? Assessing the role of immigration policies

PublishedApril 2018
PublisherBankwest Curtin Economics Centre
Number of Pages71

This paper compares immigration flows in response to changes in labour market conditions to provide an assessment of Australia’s selective immigration policies. We find employer sponsored immigration varied in line with changes in regional wages, with immigrants being drawn to states with greater wage grown. In contrast, evidence does not support this trend for points-based immigrants. We account for the endogeneity bias by exploiting differences in the impact of exogenous commodity price fluctuations on regional wages. A complimentary analysis of a points-based immigration policy reform in 2012 further highlights the role of employers in alleviating the apparent misallocation of points-based immigrants.