Center of Excellence for Migration and Integration Research (CEMIR)

CEMIR integrates different economic fields to answer current questions regarding migration. It achieves a lasting impact through the creation of a center for academic discourse and the promotion of young scientists as well as through being a forum for public debate and information.

Potential Gains and Daunting Challenges

Diverging demographic developments in Europe and in developing countries create a potential for huge mutual gains from migration. The elimination of political migration barriers would probably lead to a big increase in world GDP. On the other hand large migration flows from poor countries to Europe pose a challenge. The size and composition of migration flows would respond to differences in welfare state generosity rather than to differences in the marginal products of labour.

A further challenge is the setting of incentives to attract high-skilled immigrants and to keep high-skilled natives in the country. The integration of immigrants, in particular into education system and labour market, is another crucial issue. The right design of education systems, which must compete internationally, thereby becomes a major prerequisite of a successful immigration policy.

Another important question is the interaction of international capital flows and migration. As international capital flows are redirected from peripheral to central countries in the context of the European debt crisis, will jobs and migrants follow?

The coexistence of huge potential gains and daunting challenges raises the question: How must receiving countries’ welfare state and labour market institutions as well as immigration policies be designed so that migration can unlock mutual benefits for all parties involved?

CEMIR – An Integrated Approach

The Center of Excellence for Migration and Integration Research (CEMIR) at the ifo Institute creates a lasting research environment that contributes towards answering the questions concerning optimal immigration policies. The stand-alone feature of CEMIR is the pursuit of an integrated approach that bridges the usual divide in economics between theorists and empiricists on the one hand, and labour market economists, public economists, education economists and globalization researchers on the other. The Center draws on expertise from four departments of the ifo Institute (ifo Center for the Economics of Education and Innovation, ifo Center for International Institutional Comparisons and Migration Research, ifo Center for International Economics and ifo Center for Labour Market Research and Family Economics) and from the corresponding research areas in the CESifo Network.

A Center for Academic Discourse and Promotion of Young Scientists

With the objective of achieving a sustained impact, CEMIR organizes yearly workshops for migration researchers at graduate student, post doctoral and assistant professor levels. CEMIR invites senior scholars to give keynote addresses and to comment on work by young researchers. Furthermore, yearly conferences on migration target established researchers and allow CEMIR to establish ifo as the meeting point for the best researchers in the area.  

A Center for Public Debate and Information

A key goal of CEMIR is to fill information gaps, disseminate its research and data to the public, policy-makers, professional organizations and interest groups and to participate in the ongoing policy debate in Germany and the EU. Furthermore, academic conferences and non-academic workshops held at ifo create a platform for knowledge transfer.

The research modules of CEMIR focus on questions regarding optimal immigration policies and the right design of social, educational and labour market institutions. They discuss issues regarding the economic and social integration of immigrants and the competition for talent. An integrated model to assess the effects of immigration policies will be provided at a later stage.

Module 1: Optimal Immigration Policies with Skill Complementarities and Redistribution

Immigration affects the welfare of different native skill groups through wage effects on the labour market (driven by production function complementarities) and income redistribution. The first module integrates a realistic description of imperfectly competitive labour markets with empirically founded estimates of skill complementarities and a stylized description of different welfare state institutions.

Module 2: The Political Economy of Immigration and the Welfare State

A large body of empirical literature has established that ethnic diversity reduces political support for income redistribution. At the same time, immigrants who obtain citizenship change the distribution of voter preferences. The second module integrates various political responses into the analysis carried out in the first module.  

Module 3: Integration of Immigrants’ Children through the Education System

This module estimates the leading determinants of educational outcomes of students with migration background, with a special focus on the role of the institutional structure of the German education system. It also analyzes to what extent integration courses for and German proficiency of adult migrants can improve the educational success of their children, and examines how pre-school German-language courses for children with migration background can improve their educational career. Methodologically, this research extends the existing microeconometric literature on the topic by exploiting quasi-experimental variation in the SOEP data and panel variation in the PISA data, among others. This part of the project provides insights on how the educational institutions can help to reduce the cost of integration and reap additional long-run benefits through the intergenerational aspects of migration.

Module 4: Economic and Social Integration of Immigrants

The first aim of this module is to examine the effects of recent changes in the German tax and transfer system (implemented through the so-called Hartz IV reform) on the economic integration of immigrants. One key question is whether the work incentives created by the reform had a differential effect on the labour supply behavior of natives and immigrants, respectively. Another important issue is whether the reform influenced the degree of income inequality between natives and immigrants. Second, with respect to social integration, the module investigates intermarriage as a way through which immigrants acquire host county customs, language skills and knowledge of the local labour market, and obtain connections which improve their job prospects and increase the rate of assimilation. The questions posed include whether there is an earnings premium associated with intermarriage and, if so, whether the premium is attributable to a faster speed of integration rather than a difference in labour-market quality between intermarried and non-intermarried immigrants. Instrumental variable techniques are used to estimate the causal effect of intermarriage on earnings. The results will provide valuable new insights into whether intermarriage is an important input into the social and economic integration of immigrants in Germany.

Module 5: International Competition for Talent and Brain Circulation

This module looks at the dynamics of brain drain and brain circulation, using mainly unique Danish register data, and the German SOEP. Munk and Poutvaara planned two surveys that were carried out by Statistics Denmark. One survey interviewed a representative sample of 3,079 Danes who emigrated and later returned to Denmark, and another 4,260 Danes who emigrated and still live abroad. Statistics Denmark then merged the survey data with register data. Respondents were asked a number of questions related to their motivations to migrate, their studies and work history abroad, and reasons for returning or staying abroad. As the main destinations for Danish emigrants include Germany, the data set allows estimating what are Germany’s strengths and weaknesses in attracting and keeping high-skilled migrants within Europe. The German SOEP is used to examine Germany’s strengths and weaknesses in keeping talented Germans and immigrants. The module also includes an investigation of how capital flows affect migration patterns. This will be of particular interest as in the aftermaths of the recent debt crises capital flows in Europe are assumed to be redirected to the safe havens of low-risk countries like Germany. Furthermore, a gravity model will be used to extend our understanding of international migration flows.

CEMIR provides an integrated approach, bringing together labour economics, public economics, political economics, education economics and globalisation research.

CEMIR is designed as the node of an international network of cooperation. It brings together various research partners, including other distinguished research institutions as well as internationally recognised individual researchers.

CEMIR is designed as the node of an international network of cooperation. It brings together various research partners, including other distinguished research institutions as well as internationally recognized individual researchers. In order to draw on US and European research and policy experience, CEMIR has a formal connection with the University of California at Davis, with the Institute for Housing and Urban Research (IBF), Uppsala University, in Sweden and with the Centre for Mobility Research, Aalborg University, in Denmark. In all three cases, CEMIR organizes academic exchange of faculty and doctoral students. The project also interacts closely with the NORFACE-financed international research consortium TEMPO, in which Panu Poutvaara is participant and team leader. On the individual level, there is an inner layer of networking, based on research cooperation with international research partners. CEMIR is an open network with the objective to attract additional institutional partners for its activities.

CEMIR organizes yearly workshops for migration researchers at graduate student, post doctoral and assistant professor levels. The Center invites senior scholars to give keynote addresses and to comment on work by young researchers. Furthermore, yearly conferences on migration target established researchers and allow CEMIR to establish ifo as the meeting point for the best researchers in the area.