Immigration, occupational choice and public employment

This paper investigates the theoretical effects of immigration in an occupa­tional choice model with three sectors: a low-skilled, a high-skilled and a pu­blic sector. The originality of our approach is to consider intersectoral mobi­lity of labor and public employment. We highlight the fact that including a public sector is crucial, since omitting it implies that low-skilled immigration unambiguously reduces wages and welfare of all workers.