Exploring a US Immigrant–Intra-Industry Trade Link

We extend two strands of literature: the determinants of intra-industry trade (IIT) and the effect of immigration on trade flows. Product-level (HS10) data for US trade with 62 nations spanning the years 1989–2001 are used to construct industry-level (HS6) IIT values. A positive relationship is reported between immigration and the level of aggregate IIT. Immigration also increases vertical IIT and horizontal IIT; however, coefficients are of greater magnitude for the latter measure. Examining variation across home countries, immigrants from lower income countries appear to exert a greater influence on IIT measures than do immigrants from higher income countries. Eastern Economic Journal (2008) 34, 252–262. doi:10.1057/palgrave.eej.9050034