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Abstract 

Course: NAA305 Bachelor Thesis in Economics 15 ECTS 

University: Mälardalen University, School of Business, Society and Engineering, Västerås 

Title: The effects of immigration on the income of native-born workers: 

Evidence from Sweden

Author: Arnold Schanzer-Larsen 

Supervisor: Johan Lindén 

Problem: Sweden has experienced a lot of immigration, and the phenomenon has received a great deal of attention in the public and political debate. There is, among other things, fear that immigration could be harmful for the labor market outcome of the receiving country. Researchers from a variety of countries have tried to address this issue by estimating the effect of immigration on the native wage of the receiving country. The results have varied strongly and no universal conclusion can be drawn. For what can be said about Sweden, there is no paper (of our knowledge) that has done any similar estimates. For that reason, it is of great importance that there is some research which could bring empirical evidence and shed light on the debate. 

Purpose of the Research: The aim of the thesis is to quantitatively measure immigrations effect on the wage of native workers in Sweden.

Methodology:  Conducting a panel study, observation of the average native income from 290 municipalities over 2011-2019 was collected. The effect was estimated using OLS regression technique and a fixed effect model. 

Conclusion: From a 10% increase in the share of foreign-born within a municipality, led on average to a 2.89% increase in the native average income in that municipality. 

Keywords: Immigration, Income, Wage, Unemployment rate, Panel study, Fixed effect model, Native, Labor market, The equilibrium model, Human capital, Skill-composition