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Table 2.
Immigration and the Extensive Margin of Firm Offshoring
Offshoring (Extensive Margin)
OLSProbitOLSOLSIVIVIV
(1)(2)(3)(4)(5)(6)(7)
Non-EU Immigrant Sharet-1 −0.303** −0.206** −0.321** −0.349** −0.740** −0.785** −0.826** 
 (0.150) (0.085) (0.161) (0.171) (0.267) (0.302) (0.335) 
Labor Productivityt-1    0.015***   0.015*** 
    (0.002)   (0.002) 
Capital Intensityt-1    0.065**   0.067** 
    (0.028)   (0.028) 
Foreignt-1    0.002*   0.001 
    (0.001)   (0.001) 
Industry, Municipality and Year Fixed Effects yes yes yes yes yes yes yes 
Firm Fixed Effects no no yes yes no yes yes 
Firm Size Dummies and no no no yes no no yes 
Multi-establishment Dummy 
Workforce Characteristics no no no yes no no yes 
Mean Y 0.130 0.130 0.130 0.130 0.130 0.130 0.130 
First Stage: KP F-statistic on Instrument — — — — 13.999 12.989 12.643 
First Stage: Non-EU Img IV Coeff. — — — — 0.248*** (0.068) 0.202*** (0.067) 0.179*** (0.064) 
R2/pseudo-R2 0.254 0.375 0.763 0.763 0.254 0.763 0.764 
N 439,627 439,627 439,627 439,627 439,627 439,627 439,627 
Offshoring (Extensive Margin)
OLSProbitOLSOLSIVIVIV
(1)(2)(3)(4)(5)(6)(7)
Non-EU Immigrant Sharet-1 −0.303** −0.206** −0.321** −0.349** −0.740** −0.785** −0.826** 
 (0.150) (0.085) (0.161) (0.171) (0.267) (0.302) (0.335) 
Labor Productivityt-1    0.015***   0.015*** 
    (0.002)   (0.002) 
Capital Intensityt-1    0.065**   0.067** 
    (0.028)   (0.028) 
Foreignt-1    0.002*   0.001 
    (0.001)   (0.001) 
Industry, Municipality and Year Fixed Effects yes yes yes yes yes yes yes 
Firm Fixed Effects no no yes yes no yes yes 
Firm Size Dummies and no no no yes no no yes 
Multi-establishment Dummy 
Workforce Characteristics no no no yes no no yes 
Mean Y 0.130 0.130 0.130 0.130 0.130 0.130 0.130 
First Stage: KP F-statistic on Instrument — — — — 13.999 12.989 12.643 
First Stage: Non-EU Img IV Coeff. — — — — 0.248*** (0.068) 0.202*** (0.067) 0.179*** (0.064) 
R2/pseudo-R2 0.254 0.375 0.763 0.763 0.254 0.763 0.764 
N 439,627 439,627 439,627 439,627 439,627 439,627 439,627 

The dependent variable is a binary variable indicating whether the firm offshores (narrow definition). The non-EU immigrant sharet-1 is the lagged share of non-EU foreign workers within the municipality. Workforce composition characteristics include the lagged share of male workers and average years of education, age, tenure, and work experience. In column 2, we report the marginal effect of the non-EU immigrant sharet-1 calculated at the mean of the independent variables. Robust standard errors clustered at the municipality level in parentheses. Significance levels: ***1%, **5%, and *10%.

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