The Employment Effects of Immigration: Evidence from the Mass Arrival of German Expellees in Post-war Germany

This paper studies the employment effects of the influx of millions of German expellees to West Germany after World War II. The expellees were forced to relocate to post-war Germany. They represented a complete cross-section of society, were close substitutes to the native West German population, and were very unevenly distributed across labor market segments in West Germany. We find a substantial negative effect of expellee inflows on native employment. The effect was, however, limited to labor market segments with very high inflow rates. IV regressions that exploit variation in geographical proximity and in pre-war occupations confirm the OLS results.