The Location of Immigrants in Italy: Disentangling Networks and Local Effects

Abstract

This paper analyses the location choice of immigrants living in Italy in 2002-2007 and aims at separating the so called "network effect" from other locality-specific characteristics. The network effect is identified by the number of previous arrivals in the same location, whereas other local, geographically-specific characteristics-such as the local labour-market conditions or the presence of higher-quality amenities-are assumed to be time invariant. Our econometric estimation takes into account the spatial correlation in our data. The results show that, if local characteristics are the main factor explaining the spatial repartition of immigrants in Italy, network effects also have a sizable effect, particularly in the largest cities of Northern Italy.