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The Effect of Changes in the U.S. Wage Structure on Recent Immigrants' Earnings

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Author Info

  • Darren Lubotsky

    (University of Illinois at Urbana-Champaign)

Abstract

Since recent immigrants tend to earn less than natives, their relative earnings have been adversely affected by an increase in the return to labor market skills over the past three decades. Using longitudinal Social Security records matched to cross-sections of the SIPP and CPS, I estimate the return to skills rose by 41% between 1980 and 1997. This reduced the relative earnings of immigrants who arrived in the 1980s and early 1990s by 10 to 15 percentage points. Examining solely the earnings of recent immigrants may lead to an overly pessimistic picture of their actual labor market skills. © 2011 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

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Bibliographic Info

Article provided by MIT Press in its journal The Review of Economics and Statistics.

Volume (Year): 93 (2011)
Issue (Month): 1 (February)
Pages: 59-71

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Handle: RePEc:tpr:restat:v:93:y:2011:i:1:p:59-71

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References

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  1. 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.
  2. Borjas, George J, 1985. "Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants," Journal of Labor Economics, University of Chicago Press, vol. 3(4), pages 463-89, October.
  3. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-42, June.
  4. Katz, Lawrence F. & Autor, David H., 1999. "Changes in the wage structure and earnings inequality," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 26, pages 1463-1555 Elsevier.
  5. Edin, Per-Anders & LaLonde, Robert J. & Åslund, Olof, 2000. "Emigration of Immigrants and Measures of Immigrant Assimilation: Evidence from Sweden," Working Paper Series 2000:13, Uppsala University, Department of Economics.
  6. Kristin F. Butcher & John DiNardo, 2002. "The Immigrant and native-born wage distributions: Evidence from United States censuses," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 56(1), pages 97-121, October.
  7. Robert J. LaLonde & Robert H. Topel, 1992. "The Assimilation of Immigrants in the U. S. Labor Market," NBER Chapters, in: Immigration and the Workforce: Economic Consequences for the United States and Source Areas, pages 67-92 National Bureau of Economic Research, Inc.
  8. Darren Lubotsky, 2007. "Chutes or Ladders? A Longitudinal Analysis of Immigrant Earnings," Journal of Political Economy, University of Chicago Press, vol. 115(5), pages 820-867, October.
  9. MaCurdy, Thomas E., 1982. "The use of time series processes to model the error structure of earnings in a longitudinal data analysis," Journal of Econometrics, Elsevier, vol. 18(1), pages 83-114, January.
  10. Wei-Yin Hu, 2000. "Immigrant Earnings Assimilation: Estimates from Longitudinal Data," American Economic Review, American Economic Association, vol. 90(2), pages 368-372, May.
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Cited by:
  1. Christian Dustmann, 2014. "Selective Outmigration and the Estimation of Immigrants Earnings Profiles," CReAM Discussion Paper Series 1402, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  2. Bernt Bratsberg & Erling Barth & Oddbjørn Raaum, 2006. "Local Unemployment and the Relative Wages of Immigrants: Evidence from the Current Population Surveys," The Review of Economics and Statistics, MIT Press, vol. 88(2), pages 243-263, May.
  3. Cobb-Clark, Deborah A. & Hanel, Barbara & McVicar, Duncan, 2012. "Immigrant Wage and Employment Assimilation: A Comparison of Methods," IZA Discussion Papers 7062, Institute for the Study of Labor (IZA).
  4. Heather Antecol & Peter Kuhn & Stephen Trejo, 2006. "Assimilation via Prices or Quantities? Sources of Immigrant Earnings Growth in Australia, Canada and the United States," CReAM Discussion Paper Series 0603, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  5. Antecol, Heather & Kuhn, Peter J. & Trejo, Stephen, 2003. "Assimilation via Prices or Quantities? Labor Market Institutions and Immigrant Earnings Growth in Australia, Canada, and the United States," IZA Discussion Papers 802, Institute for the Study of Labor (IZA).
  6. George J. Borjas, 2013. "The Slowdown in the Economic Assimilation of Immigrants: Aging and Cohort Effects Revisited Again," NBER Working Papers 19116, National Bureau of Economic Research, Inc.

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