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Credit Constraints and the Labour Supply of Immigrant Families in Canada

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Author Info
Christopher Worswick

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Abstract

The hours of work decisions in immigrant and nonimmigrant families are compared using an intertemporal labor-supply model estimated over data from the 1981 and 1991 Census of Canada surveys. The family investment hypothesis is evaluated. The hypothesis states that the immigrant family is unable to borrow in the first years after migration and that the immigrant wife responds by working longer hours so as to support family consumption and her husband's labor market adjustment. The empirical evidence, in general, supports the hypothesis since credit constraints are found to significantly distort the labor-supply decisions of recently arrived immigrant families.

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File URL: http://economics.ca/cgi/xms?jab=v32n1/09.pdf
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Publisher Info
Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 32 (1999)
Issue (Month): 1 (February)
Pages: 152-170
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Handle: RePEc:cje:issued:v:32:y:1999:i:1:p:152-170

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  1. Cobb-Clark, Deborah A. & Crossley, Thomas F., 2001. "Gender, Comparative Advantage and Labor Market Activity in Immigrant Families," IZA Discussion Papers 293, Institute for the Study of Labor (IZA). [Downloadable!]
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  2. Deborah Cobb-Clark & Marie D. Connolly & Christopher Worswick, 2001. "The Job Search and Investments of Immigrant Families," CEPR Discussion Papers 432, Centre for Economic Policy Research, Research School of Social Sciences, Australian National University. [Downloadable!]
  3. Deborah Cobb-Clark & Marie D. Connolly & Christopher Worswick, 2000. "Does the Family Investment Hypothesis Explain Immigrant Labor Market Activity?," Econometric Society World Congress 2000 Contributed Papers 0828, Econometric Society. [Downloadable!]
  4. Rashid, Saman, 2004. "Married immigrant women and employment.The role of family investments," UmeÃ¥ Economic Studies 623, Umeå University, Department of Economics. [Downloadable!]
  5. Sarit Cohen-Goldner & Chemi Gotlibovski & Nava Kahana, 2006. "The Role of Marriage in Immigrants’ Human Capital Investment under Liquidity Constraints," IZA Discussion Papers 2308, Institute for the Study of Labor (IZA). [Downloadable!]
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  6. Rashid, Saman, 2004. "Immigrants' Income and Family Migration," UmeÃ¥ Economic Studies 625, Umeå University, Department of Economics. [Downloadable!]
  7. Hou, Feng & Picot, Garnett, 2003. "The Rise in Low-income Rates Among Immigrants in Canada," Analytical Studies Branch Research Paper Series 2003198e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
  8. Deborah Cobb-Clark & Thomas F. Crossley, 2002. "Revisiting the Family Investment Hypothesis," Department of Economics Working Papers 2002-04, McMaster University. [Downloadable!]
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