This paper investigates the degree of labour market competitions between White and ethnic minority labour using four waves of the British Household Panel Survey (1997). Firstly, the isolated effect of ethnic minority shares in certain counties on wages of White workers is examined. Then, the extent of labour market competition between ethnic minorities and Whites is examined in terms of elasticities of complementarity using translog production technology. The estimations suggest, in general terms, that ethnic minority labour is complementary to high skilled non-manual and low skilled manual White labour. The substitution relationship is especially evident between ethnic minority labour on the one hand and low skilled, medium skilled-non-manual and medium skilled manual White labour on the other hand. However, the elasticities of complementarity are larger than the elasticities of substitution. In balance, the complementarity tends to slightly outweigh the substitutability. There is no indication that ethnic minorities have an unambiguous and large adverse effect on the wages of Whites.
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Paper provided by Institute for Social and Economic Research in its series ISER working papers with number
2001-14.
Length: 26 Date of creation: Jul 2001 Date of revision: Handle: RePEc:ese:iserwp:2001-14
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