Limits to wage growth : understanding the wage divergence between immigrants and natives / Apoorva Jain (University of North Carolina-Chapel Hill), Klara Sabirianova Peter (University of North Carolina-Chapel Hill, IZA and CEPR) ; IZA Institute of Labor Economics
VerfasserJain, Apoorva ; Sabirianova Peter, Klara In der Gemeinsamen Normdatei der DNB nachschlagen
KörperschaftForschungsinstitut zur Zukunft der Arbeit In der Gemeinsamen Normdatei der DNB nachschlagen
ErschienenBonn, Germany : IZA Institute of Labor Economics, July 2017
Elektronische Ressource
Umfang1 Online-Ressource (52, 22 Seiten) : Diagramme
SerieDiscussion paper ; no. 10891
URNurn:nbn:de:hbz:5:2-136216 Persistent Identifier (URN)
 Das Dokument ist frei verfügbar.
Limits to wage growth [0.44 mb]
Verfügbarkeit In meiner Bibliothek

This study finds evidence of wage divergence between immigrants and natives in Germany using a country-wide household panel from 1984 to 2014. We incorporate the possibility of wage divergence into a two-period model of economic assimilation by modeling the differences in the efficiency of human capital production and prices per unit of human capital between immigrants and natives. Individual rates of wage convergence are found to be higher for immigrants who fled warfare zones, belong to established ethnic networks, and acquired more years of pre-migration schooling. Using a doubly robust treatment effect estimator and the IV method, the study finds that the endogenous post-migration education in the host country contributes substantially to closing the wage gap with natives. The treatment effect is heterogeneous, favoring immigrants who are similar to natives. This paper also addresses the commonly ignored sample selection issue due to non-random survey attrition and employment participation. Empirical evidence favors the "efficiency" over the "discrimination" channels of wage divergence.