This paper examines the difference between the payoffs to schooling for immigrants and the native born in Canada, using 2001 Census data. Analyses are presented for males and females. Comparisons are offered with findings for the US. The paper uses the Overeducation/Required education/Undereducation framework (Hartog, 2000) and a decomposition developed by Chiswick and Miller (2008). This decomposition links overeducation to the less-than-perfect international transferability of immigrants' human capital, and under-education to favourable selection in immigration. The results show that immigrants have a lower payoff to schooling because of the different effects under-education and over-education have on their earnings. The effects of under-education, or selection in immigration, are, however, twice as large as the effects of over-education, or limited international transferability of human capital. Favourable selection in immigration appears to be less important in Canada than in the US, where it predominates among the least educated.
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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number
4448.
Length: 43 pages Date of creation: Sep 2009 Date of revision: Publication status: forthcoming in Ted McDonald, Elizabeth Ruddick, Arthur Sweetman, and Christopher Worswick (eds.), Canadian Immigration: Economic Evidence for a Dynamic Policy Environment, Montreal and Ithaca: McGill-Queen's University Press; distributed by Cornell University Press Services, Ithaca. Handle: RePEc:iza:izadps:dp4448
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