Abstract
Seminar on 28 Juni, 2004
MNB Visitor Centre 10 am
Rachel Friedberg
Brown University
Robert Sauer
The Hebrew University of Jerusalem
Does the Presence of Foreign Guest Workers in Israel Harm Palestinians from the West Bank and Gaza Strip?
Abstract
Starting in the late 1980s, the Israeli market for unskilled labor began a liberalization process that resulted in a large influx of foreign guest workers from overseas. The vast majority of overseas foreign workers directly compete with Palestinians from the West Bank and Gaza Strip for jobs in Israel. Using micro level panel data from the Territories Labor Force Survey and monthly time-series data on the number of foreign guest workers in Israel, this paper measures the effects of the presence of foreign guest workers on Palestinian employment and earnings. OLS and IV estimates indicate that the presence of foreign guest workers substantially reduces Palestinian employment levels in Israel. Palestinians from Gaza are displaced to a greater extent than are Palestinians from the West Bank. OLS and IV estimates indicate a large and significant reduction in mean monthly and mean daily earnings among Palestinians from Gaza, but not among Palestinians from the West Bank.
Contact person: Zsolt Darvas