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Local Unemployment and the Earnings Assimilation of Immigrants in Norway

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Author Info
Barth, Erling () (Institute for Social Research)
Bratsberg, Bernt () (Ragnar Frisch Centre for Economic Research)
Raaum, Oddbjørn () (Ragnar Frisch Centre for Economic Research)

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Abstract

Labour market outcomes of immigrants and natives are affected differently by macroeconomic conditions. In particular, we show that earnings of immigrants in Norway from outside the OECD area are more sensitive to local labour market conditions than are earnings of natives. Failure to account for such differences may bias estimates when periods of rising or declining unemployment are important to identify assimilation effects on immigrant earnings. We show that this is the case for Norway: An observed drop in relative earnings of non-OECD immigrants after about 10 years in the host country disappears when we account for differential business cycle effects on immigrant and native earnings. The empirical evidence also reveals that local labour market conditions impact the rate of the earnings assimilation. We interpret the effect of unemployment on the assimilation rate in terms of a combined "wage curve effect” and a “learning effect” on the rate at which immigrants acquire country-specific human capital.

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File URL: http://www.oekonomi.uio.no/memo/memopdf/memo1902.pdf
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Publisher Info
Paper provided by Oslo University, Department of Economics in its series Memorandum with number 19/2002.

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Length: 48 pages
Date of creation: 17 Jun 2003
Date of revision:
Handle: RePEc:hhs:osloec:2002_019

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Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway
Phone: 22 85 51 27
Fax: 22 85 50 35
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Web page: http://www.oekonomi.uio.no/indexe.html
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Related research
Keywords: immigrants; unemployment; Labour market; assimilation;

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Find related papers by JEL classification:
J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers
J82 - Labor and Demographic Economics - - Labor Standards - - - Labor Force Composition

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Robert J. LaLonde & Robert H. Topel, 1990. "The Assimilation of Immigrants in the U.S. Labor Markets," NBER Working Papers 3573, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  2. 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. [Downloadable!]
    Other versions:
  3. John E. Hayfron, 1998. "The performance of immigrants in the Norwegian labor market," Journal of Population Economics, Springer, vol. 11(2), pages 293-303. [Downloadable!] (restricted)
  4. Barry R. Chiswick & Yinon Cohen & Tzippi Zach, 1997. "The labor market status of immigrants: Effects of the unemployment rate at arrival and duration of residence," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 50(2), pages 289-303, January.
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  7. Nielsen, Helena Skyt & Rosholm, Michael & Smith, Nina & Husted, Leif, 2001. "Qualifications, Discrimination, or Assimilation? An Extended Framework for Analysing Immigrant Wage Gaps," IZA Discussion Papers 365, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  8. Barth, Erling & Bratsberg, Bernt & Raaum, Oddbjørn, 2003. "Local Unemployment and the Relative Wages of Immigrants: Evidence from the Current Population Surveys," Memorandum 20/2002, Oslo University, Department of Economics. [Downloadable!]
    Other versions:
  9. Bauer, Thomas K. & Lofstrom, Magnus & Zimmermann, Klaus F., 2000. "Immigration Policy, Assimilation of Immigrants and Natives' Sentiments towards Immigrants: Evidence from 12 OECD-Countries," IZA Discussion Papers 187, Institute for the Study of Labor (IZA). [Downloadable!]
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  11. Eli Berman & Kevin Lang & Erez Siniver, 2000. "Language-Skill Complementarity: Returns to Immigrant Language Acquisition," NBER Working Papers 7737, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  12. Blanchflower, David G & Oswald, Andrew J, 1990. " The Wage Curve," Scandinavian Journal of Economics, Blackwell Publishing, vol. 92(2), pages 215-35.
    Other versions:
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  13. Barth, Erling & Bratsberg, Bernt & Naylor, Robin A. & Raaum, Oddbjørn, 2002. "Explaining Variations in Wage Curves: Theory and Evidence," Memorandum 03/2002, Oslo University, Department of Economics. [Downloadable!]
  14. Greenwood, Michael J & McDowell, John M, 1991. "Differential Economic Opportunity, Transferability of Skills, and Immigration to the United States and Canada," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 612-23, November. [Downloadable!] (restricted)
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  19. 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. [Downloadable!] (restricted)
  20. Jasso, Guillermina & Rosenzweig, Mark R., 1985. "What's In a Name? Country-of-Origin Influences on the Earnings of Immigrants in the United States," Bulletins 8424, University of Minnesota, Economic Development Center. [Downloadable!]
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  23. James Ted McDonald & Christopher Worswick, 1998. "The Earnings of immigrant men in Canada: Job tenure, cohort, and macroeconomic conditions," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 51(3), pages 465-482, April.
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  25. Borjas, George J, 1987. "Self-Selection and the Earnings of Immigrants," American Economic Review, American Economic Association, vol. 77(4), pages 531-53, September. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Christian Dustmann & Albrecht Glitz & Thorsten Vogel, 2006. "Employment, Wages, and the Economic Cycle: Differences between Immigrants and Natives," CReAM Discussion Paper Series 0609, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London. [Downloadable!]
    Other versions:
  2. Galloway, Taryn Ann & Aaberge, Rolf, 2003. "Assimilation Effects on Poverty Among Immigrants in Norway," Memorandum 07/2003, Oslo University, Department of Economics. [Downloadable!]
    Other versions:
  3. Barth, Erling & Bratsberg, Bernt & Raaum, Oddbjørn, 2003. "Local Unemployment and the Relative Wages of Immigrants: Evidence from the Current Population Surveys," Memorandum 20/2002, Oslo University, Department of Economics. [Downloadable!]
    Other versions:
  4. Akay, Alpaslan & Karabulut, Gokhan & Tezic, Kerem, 2006. "Economic Performance of Turkish Immigrant Men in the European Labour-Market: Evidence from Sweden," Working Papers in Economics 240, Göteborg University, Department of Economics. [Downloadable!]
  5. Hans Bonesrønning & Torberg Falch & Bjarne Strøm, 2003. "Teacher Sorting, Teacher Quality, and Student Composition: Evidence from Norway," Working Paper Series 3403, Department of Economics, Norwegian University of Science and Technology. [Downloadable!]
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