The Effect of Migrant Workers on Labor in the Manufacturing Industry in Taiwan

This paper presents an approach for estimating the impact of migrant workers on wage of native workers. If a particular group of native workers is replaced by migrant workers, the wages of the native workers will decline. The reduction of the wages of native workers may depend on how easily their jobs can be taken to migrant workers. Second, if migrant workers complement a particular group of native workers, the wage of the native workers will increase. However, the policy for importation of migrant workers will not encourage the human capital accumulation, because the importation of migrant workers will reduce the return on years of education and on tenure.