  We study the impact of low-skilled immigration in a general equilibrium
search and matching model, with heterogeneous workers producing intermediate
goods, which are used in the production of two final goods. In addition to
complementarity/substitution between native and non-native workers, we explore
how immigration affects the relative prices of final goods and wages. An
application to Italy reveals a positive contribution of immigrants to GDP,
public revenues, and the per capita provision of public goods. Employers and
employees in the high-skilled-intensive market are winners, while losers are
employers in the low-skilled-intensive market. The effects on low-skilled
employees are instead inconclusive.
