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Computer usage, destination language proficiency and the earnings of natives and immigrants

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Author Info

  • Barry Chiswick

    ()

  • Paul Miller

Abstract

This paper uses the concept of a computer as a public good within the household to model the demand for computers at home. It also investigates the determinants, and consequences for earnings, of computer use. The equations are estimated using data on the native born and immigrants from the 2001 Census of Population and Housing in Australia. The multivariate analyses show that recent arrivals are more likely to use computers than the Australian born. The data suggests a high degree of favorable selection in migration as the level of computer use in Australia is much higher than in most of the countries that Australia’s immigrants come from. Those with a higher permanent income (education, household assets) are more likely to have a computer at home, but there is no effect of transitory income (unemployment). Immigrants who are more proficient in English are also more likely to use a computer. The relation between age and computer use is strongly influenced by cohort effects. Using a computer at home is associated with about 7% and 13% higher earnings for native-born and foreign-born men, respectively. For the immigrants, the effects of schooling and English language proficiency on earnings are greater among those who use a computer at home. This suggests complementarity in the labor market. The use of a computer is shown to be a way the foreign born can increase the international transferability of their pre-immigration skills, a finding that has implications for immigrant assimilation policies. Copyright Springer Science+Business Media, LLC 2007

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File URL: http://hdl.handle.net/10.1007/s11150-007-9007-0
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Bibliographic Info

Article provided by Springer in its journal Review of Economics of the Household.

Volume (Year): 5 (2007)
Issue (Month): 2 (June)
Pages: 129-157

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Handle: RePEc:kap:reveho:v:5:y:2007:i:2:p:129-157

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Web page: http://www.springerlink.com/link.asp?id=109451

Related research

Keywords: Computers; Internet; Immigrants; Language; Earnings; D13; J15; J24; J31; J61; F22;

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References

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  1. Chiswick, Barry R. & Miller, Paul W., 2002. "The Complementarity of Language and Other Human Capital: Immigrant Earnings in Canada," IZA Discussion Papers 451, Institute for the Study of Labor (IZA).
  2. Christian Dustmann & Arthur van Soest, 2001. "Language Fluency And Earnings: Estimation With Misclassified Language Indicators," The Review of Economics and Statistics, MIT Press, vol. 83(4), pages 663-674, November.
  3. John E. DiNardo & Jorn-Steffen Pischke, 1996. "The Returns to Computer Use Revisited: Have Pencils Changed the Wage Structure Too?," NBER Working Papers 5606, National Bureau of Economic Research, Inc.
  4. Ernest P. Goss & Joseph M. Phillips, 2002. "How Information Technology Affects Wages: Evidence Using Internet Usage As a Proxy for IT Skills," Journal of Labor Research, Transaction Publishers, vol. 23(3), pages 463-474, July.
  5. Harry A. Krashinsky, 2004. "Do Marital Status and Computer Usage Really Change the Wage Structure?," Journal of Human Resources, University of Wisconsin Press, vol. 39(3).
  6. Puhani, Patrick A, 2000. " The Heckman Correction for Sample Selection and Its Critique," Journal of Economic Surveys, Wiley Blackwell, vol. 14(1), pages 53-68, February.
  7. Richard Fry & B. Lindsay Lowell, 2003. "The value of bilingualism in the U.S. labor market," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 57(1), pages 128-141, October.
  8. Halvorsen, Robert & Palmquist, Raymond, 1980. "The Interpretation of Dummy Variables in Semilogarithmic Equations," American Economic Review, American Economic Association, vol. 70(3), pages 474-75, June.
  9. Chiswick, Barry R. & Miller, Paul W., 2004. "Linguistic Distance: A Quantitative Measure of the Distance Between English and Other Languages," IZA Discussion Papers 1246, Institute for the Study of Labor (IZA).
  10. Paul W. Miller & Leanne M. Neo, 2003. "Labour Market Flexibility and Immigrant Adjustment," The Economic Record, The Economic Society of Australia, vol. 79(246), pages 336-356, 09.
  11. Chiswick, Barry R, 1978. "The Effect of Americanization on the Earnings of Foreign-born Men," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 897-921, October.
  12. Chiswick, Barry R & Miller, Paul W, 1985. "Immigrant Generation and Income in Australia," The Economic Record, The Economic Society of Australia, vol. 61(173), pages 540-53, June.
  13. Baker, Michael & Benjamin, Dwayne, 1994. "The Performance of Immigrants in the Canadian Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 12(3), pages 369-405, July.
  14. Martins, Pedro S. & Pereira, Pedro T., 2004. "Does education reduce wage inequality? Quantile regression evidence from 16 countries," Labour Economics, Elsevier, vol. 11(3), pages 355-371, June.
  15. Chiswick, Barry R & Miller, Paul W, 1995. "The Endogeneity between Language and Earnings: International Analyses," Journal of Labor Economics, University of Chicago Press, vol. 13(2), pages 246-88, April.
  16. Peter Dolton & Gerry Makepeace, 2004. "Computer Use and Earnings in Britain," Economic Journal, Royal Economic Society, vol. 114(494), pages C117-C129, 03.
  17. Moshe Buchinsky, 1998. "Recent Advances in Quantile Regression Models: A Practical Guideline for Empirical Research," Journal of Human Resources, University of Wisconsin Press, vol. 33(1), pages 88-126.
  18. G. R. Arabsheibani & J. M. Emami & A. Marin, 2004. "The Impact of Computer Use On Earnings in the UK," Scottish Journal of Political Economy, Scottish Economic Society, vol. 51(1), pages 82-94, 02.
  19. Liu, Jin-Tan & Tsou, Meng-Wen & Hammitt, James K., 2004. "Computer use and wages: evidence from Taiwan," Economics Letters, Elsevier, vol. 82(1), pages 43-51, January.
  20. Chiswick, Barry R, 1977. "Sons of Immigrants: Are They at an Earnings Disadvantage?," American Economic Review, American Economic Association, vol. 67(1), pages 376-80, February.
  21. Miller, Paul & Mulvey, Charles, 1997. "Computer Skills and Wages," Australian Economic Papers, Wiley Blackwell, vol. 36(68), pages 106-13, June.
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Citations

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Cited by:
  1. Mélitz, Jacques & Toubal, Farid, 2012. "Native language, spoken language, translation and trade," CEPR Discussion Papers 8994, C.E.P.R. Discussion Papers.
  2. Zaiceva, Anzelika & Zimmermann, Klaus F., 2010. "Do Ethnic Minorities "Stretch" Their Time? Evidence from the UK Time Use Survey," IZA Discussion Papers 4910, Institute for the Study of Labor (IZA).
  3. Oosterbeek, Hessel & Ponce, Juan, 2011. "The impact of computer use on earnings in a developing country: Evidence from Ecuador," Labour Economics, Elsevier, vol. 18(4), pages 434-440, August.
  4. Jacques Melitz, 2012. "A Framework for Analyzing Language and Welfare," Heriot-Watt University Economics Discussion Papers 1212, Department of Economics, School of Management and Languages, Heriot Watt University.
  5. Ana Cardoso & Elsa Fontainha & Chiara Monfardini, 2010. "Children’s and parents’ time use: empirical evidence on investment in human capital in France, Germany and Italy," Review of Economics of the Household, Springer, vol. 8(4), pages 479-504, December.
  6. Chiswick, Barry R., 2008. "The Economics of Language: An Introduction and Overview," IZA Discussion Papers 3568, Institute for the Study of Labor (IZA).
  7. Anzelika Zaiceva & Klaus Zimmermann, 2011. "Do ethnic minorities “stretch” their time? UK household evidence on multitasking," Review of Economics of the Household, Springer, vol. 9(2), pages 181-206, June.

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