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Immigration from the Eastern Block and the former Soviet Union to Israel: Who is coming when?

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  • Locher, Lilo

    ()
    (Federal Monopoly Commission, Bonn)

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    Abstract

    Average education of new immigrants from the East European countries and the former Soviet Union (FSU) in Israel declined during the last ten years. I present a simple two-period model of migration with uncertainty about future conditions in both countries and estimate a reduced form, using data from the Israeli 1995 Census and several years of the Israeli Labor Force Survey. Wages in Israel in each period are the result of a human capital investment decision. In this framework, the return to migrating early is higher, the higher the education of a potential migrant, but education also increases the option value of staying. Estimation of a Cox proportionate hazard model and a discrete time hazard model suggest that human capital investment considerations indeed influence the timing of migration. Other variables that make people mi-grate earlier are being Jewish, being married, and having no children. Economic conditions in the source countries and in the destination country, which are also included in the regressions, do not seem to matter and cover mainly time effects.

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    Bibliographic Info

    Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 227.

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    Length: 38 pages
    Date of creation: Dec 2000
    Date of revision:
    Publication status: published in: European Economic Review, 2004, 48 (6), 1243-1255
    Handle: RePEc:iza:izadps:dp227

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    Related research

    Keywords: migration as an option; human capital investment; Migration decision; duration model;

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    References

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    1. David Card, 1995. "The Wage Curve: A Review," Journal of Economic Literature, American Economic Association, vol. 33(2), pages 285-299, June.
    2. Pindyck, Robert S., 1990. "Irreversibility, uncertainty, and investment," Working papers 3137-90., Massachusetts Institute of Technology (MIT), Sloan School of Management.
    3. repec:fth:prinin:343 is not listed on IDEAS
    4. Burda, Michael C, 1995. "Migration and the Option Value of Waiting," CEPR Discussion Papers 1229, C.E.P.R. Discussion Papers.
    5. Baker, Michael & Benjamin, Dwayne, 1997. "The Role of the Family in Immigrants' Labor-Market Activity: An Evaluation of Alternative Explanations," American Economic Review, American Economic Association, vol. 87(4), pages 705-27, September.
    6. Harriet Duleep & Seth Sanders, 1993. "The decision to work by married immigrant women," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 46(4), pages 677-690, July.
    7. 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.
    8. Moulton, Brent R, 1990. "An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Unit," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 334-38, May.
    9. Friedberg, Rachel M, 2000. "You Can't Take It with You? Immigrant Assimilation and the Portability of Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 18(2), pages 221-51, April.
    10. Mark C. Regets & Harriet Orcutt Duleep, 1999. "Immigrants and Human-Capital Investment," American Economic Review, American Economic Association, vol. 89(2), pages 186-191, May.
    11. 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, Cornell University, ILR School, vol. 50(2), pages 289-303, January.
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