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The Impact Of Immigrants’ Entries On Destination Countries’ Economies, Qingyu Zhu

Economics Honors Projects

Whether immigration brings benefit or harm has always been controversial. In this paper, I develop a Real Business Cycle model with a search-based labor market to examine how an unexpected influx of immigrants impacts destination economies. I divide households and firms into two types, namely natives and immigrants, and conduct a general equilibrium analysis. The simulated results suggest that even though natives face a temporary rise in unemployment after the shock, recovery occurs quickly, and levels of aggregate output and consumption become higher.