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Does citizenship matter? The economic impact of naturalizations in Germany

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  • Max Friedrich Steinhardt

    ()
    (Centro Studi Luca d’Agliano and Hamburg Institute of International Economics)

Abstract

The paper analyzes whether citizenship acquisition affects the labor market performance of immigrants in Germany. The study uses actual micro data from the IAB employment sample, which covers more than 80% of the whole labor force in Germany. The econometric analysis is carried out using both cross-sectional and panel data techniques, which allow to disentangle the effects of self-selection and legal impact of citizenship acquisition. The estimates from a simple OLS specification suggest the existence of a wage premium of naturalized immigrants. Panel estimates show an immediate positive naturalization effect on wages and an accelerated wage growth in the years after the naturalization event. Both results are consistent with the argument that naturalization increases the labor market opportunities of immigrants in various ways.

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Bibliographic Info

Paper provided by Centro Studi Luca d\'Agliano, University of Milano in its series Development Working Papers with number 266.

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Length: 25
Date of creation: 30 Nov 2008
Date of revision:
Handle: RePEc:csl:devewp:266

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Keywords: Naturalization; self-selection; socioeconomic integration;

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References

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  1. Fitzenberger, Bernd & Osikominu, Aderonke & Völter, Robert, 2005. "Imputation Rules to Improve the Education Variable in the IAB Employment Subsample," ZEW Discussion Papers 05-10, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  2. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4 National Bureau of Economic Research, Inc.
  3. Hailbronner, Kay, 2007. "Diversity in the labour market: The legal framework and support services for migrant workers in Germany," HWWI Policy Papers 3-4, Hamburg Institute of International Economics (HWWI).
  4. Nijman, Theo & Verbeek, Marno, 1992. "Nonresponse in Panel Data: The Impact on Estimates of a Life Cycle Consumption Function," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 7(3), pages 243-57, July-Sept.
  5. Bevelander, Pieter & Veenman, Justus, 2006. "Naturalisation and Socioeconomic Integration: The Case of the Netherlands," IZA Discussion Papers 2153, Institute for the Study of Labor (IZA).
  6. 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.
  7. Jacob Mincer & Solomon Polacheck, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Economics of the Family: Marriage, Children, and Human Capital, pages 397-431 National Bureau of Economic Research, Inc.
  8. Leo Kaas & Christian Manger, 2012. "Ethnic Discrimination in Germany's Labour Market: A Field Experiment," German Economic Review, Verein für Socialpolitik, vol. 13(1), pages 1-20, 02.
  9. Pierre Cahuc & André Zylberberg, 2004. "Labor Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 026203316x, December.
  10. Dustmann, Christian & Glitz, Albrecht & Vogel, Thorsten, 2009. "Employment, Wages, and the Economic Cycle: Differences between Immigrants and Natives," IZA Discussion Papers 4432, Institute for the Study of Labor (IZA).
  11. Francesca Mazzolari, 2009. "Dual citizenship rights: do they make more and richer citizens?," Demography, Springer, vol. 46(1), pages 169-191, February.
  12. Steinhardt, Max Friedrich, 2007. "Aktuelle Trends der Einbürgerungen in Deutschland," Wirtschaftsdienst – Zeitschrift für Wirtschaftspolitik (1998 - 2007), ZBW – German National Library of Economics / Leibniz Information Centre for Economics, vol. 87(8), pages 544-549.
  13. Bernt Bratsberg & James F. Ragan & Zafar M. Nasir, 2002. "The Effect of Naturalization on Wage Growth: A Panel Study of Young Male Immigrants," Journal of Labor Economics, University of Chicago Press, vol. 20(3), pages 568-597, July.
  14. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1.
  15. Jacob Mincer & Solomon Polachek, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Marriage, Family, Human Capital, and Fertility, pages 76-110 National Bureau of Economic Research, Inc.
  16. DeVoretz, Don J., 2006. "The Economics of Citizenship: A Common Intellectual Ground for Social Scientists?," IZA Discussion Papers 2392, Institute for the Study of Labor (IZA).
  17. DeVoretz, Don J. & Pivnenko, Sergiy, 2005. "Self-Selection, Immigrant Public Finance Performance and Canadian Citizenship," IZA Discussion Papers 1463, Institute for the Study of Labor (IZA).
  18. Mazzolari, Francesca, 2007. "Dual Citizenship Rights: Do They Make More and Better Citizens?," IZA Discussion Papers 3008, Institute for the Study of Labor (IZA).
  19. DeVoretz, Don J. & Pivnenko, Sergiy, 2004. "The Economic Causes and Consequences of Canadian Citizenship," IZA Discussion Papers 1395, Institute for the Study of Labor (IZA).
  20. Locke, John, 1690. "Two Treatises of Government," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number locke1690a.
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Citations

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Cited by:
  1. Bevelander, Pieter & Pendakur, Ravi, 2011. "Citizenship and Employment – comparing two cool countries," CEPR Discussion Papers 8182, C.E.P.R. Discussion Papers.
  2. Otto, Alkis Henri & Steinhardt, Max Friedrich, 2012. "Immigration and election outcomes: Evidence from city districts in Hamburg," Working Paper Series 02/2012, Hamburg School of Business Administration (HSBA).
  3. Max Friedrich Steinhardt, 2009. "The wage impact of immigration in Germany - new evidence for skill groups and occupations," Development Working Papers 273, Centro Studi Luca d\'Agliano, University of Milano.
  4. Pieter Bevelander and Ravi Pendakur, 2012. "Citizenship acquisition, employment prospects and earnings: comparing two cool countries," EUI-RSCAS Working Papers 7, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
  5. Facundo Albornoz & Antonio Cabrales & Esther Hauk, 2011. "Immigration and the School System," UFAE and IAE Working Papers 888.11, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  6. Ciro Avitabile & Irma Clots-Figueras & Paolo Masella, 2010. "The Effect of Birthright Citizenship on Parental Integration Outcomes," CSEF Working Papers 246, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
  7. Tolciu, Andreia & Schaland, Ann-Julia & El-Cherkeh, Tanja, 2010. "Migrant entrepreneurship in Hamburg: Results from a qualitative study with Turkish entrepreneurs," HWWI Research Papers 3-22, Hamburg Institute of International Economics (HWWI).
  8. Gathmann, Christina & Keller, Nicolas, 2014. "Returns to Citizenship? Evidence from Germany's Recent Immigration Reforms," IZA Discussion Papers 8064, Institute for the Study of Labor (IZA).
  9. Aysegul KAYAOGLU & Ayhan KAYA, 2011. "Is National Citizenship Withering Away? : Social Affiliations and Labor Market Integration of Turkish Origin Immigrants in Germany and France," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2011033, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).

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