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The Effect of Enclave Residence on the Labour Force Activities of Immigrants in Canada

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  • Tu, Jiong

    ()
    (Human Resources and Skills Development Canada - Labour Program)

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Abstract

It has been well documented that immigrants' clustering of residence in large cities has been associated with the creation of a number of ethnic enclaves. The intensive exposure to own-ethnic population could affect immigrant labour market involvement positively or negatively. However, no extant Canadian research has provided empirical evidence on the sign of these enclave effects. In this paper, I use the 1981-2001 Censuses to estimate the impact of residence in ethnic enclaves on male immigrants' labour force participation rate and employment probability. For recent immigrants who arrived in Canada within the preceding ten years, the intensity of enclave residence is negatively associated with their labour force participation rate, but positively related to their employment probability in all censuses. However, living in an enclave has no significant effect on the labour force activity of older immigrants who have lived in Canada for more than twenty years. Since immigrants could be attracted to areas with more job opportunities and hence enlarge the size of an enclave, the estimated effects from probit regressions might be positively biased. I then use instrumental variable (IV) method to address this endogeneity problem, and the IV estimates are consistent with the probit regression results.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4744.

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Length: 40 pages
Date of creation: Feb 2010
Date of revision:
Handle: RePEc:iza:izadps:dp4744

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Keywords: immigrant; ethnicity; enclave; labour force participation; employment; Canada;

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References

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  1. Per-Anders Edin & Peter Fredriksson & Olof �slund, 2003. "Ethnic Enclaves And The Economic Success Of Immigrants - Evidence From A Natural Experiment," The Quarterly Journal of Economics, MIT Press, MIT Press, vol. 118(1), pages 329-357, February.
  2. Kenneth Clark & Stephen Drinkwater, 2002. "Enclaves, neighbourhood effects and employment outcomes: Ethnic minorities in England and Wales," Journal of Population Economics, Springer, Springer, vol. 15(1), pages 5-29.
  3. Marianne Bertrand & Erzo F.P. Luttmer & Sendhil Mullainathan, 1999. "Network Effects and Welfare Cultures," JCPR Working Papers, Northwestern University/University of Chicago Joint Center for Poverty Research 62, Northwestern University/University of Chicago Joint Center for Poverty Research.
  4. George J. Borjas, 1986. "The Self-Employment Experience of Immigrants," Journal of Human Resources, University of Wisconsin Press, vol. 21(4), pages 485-506.
  5. Edward P. Lazear, 1995. "Culture and Language," NBER Working Papers 5249, National Bureau of Economic Research, Inc.
  6. Bloom, D. & Grenier, G. & Gunderson, M., 1993. "The Changing Labour Market Position of Canadian Immigrants," Working Papers, University of Ottawa, Department of Economics 9305e, University of Ottawa, Department of Economics.
  7. Goel, Deepti & Lang, Kevin, 2009. "The Role of Social Ties in the Job Search of Recent Immigrants," CLSSRN working papers, Vancouver School of Economics clsrn_admin-2009-12, Vancouver School of Economics, revised 02 Feb 2009.
  8. David C. Maré & Steven Stillman & Melanie Morten, 2007. "Settlement Patterns and the Geographic Mobility of Recent Migrants to New Zealand," Working Papers, Motu Economic and Public Policy Research 07_11, Motu Economic and Public Policy Research.
  9. Baker, Michael & Benjamin, Dwayne, 1994. "The Performance of Immigrants in the Canadian Labor Market," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 12(3), pages 369-405, July.
  10. Chiswick, Barry R. & Miller, Paul W., 2002. "Do Enclaves Matter in Immigrant Adjustment?," IZA Discussion Papers 449, Institute for the Study of Labor (IZA).
  11. Casey Warman, 2006. "Ethnic Enclaves and Immigrant Earnings Growth," Working Papers, Queen's University, Department of Economics 1261, Queen's University, Department of Economics.
  12. Bartel, Ann P, 1989. "Where Do the New U.S. Immigrants Live?," Journal of Labor Economics, University of Chicago Press, University of Chicago Press, vol. 7(4), pages 371-91, October.
  13. Joseph G. Altonji & David Card, 1991. "The Effects of Immigration on the Labor Market Outcomes of Less-skilled Natives," NBER Chapters, in: Immigration, Trade and the Labor Market, pages 201-234 National Bureau of Economic Research, Inc.
  14. John M. Abowd & Richard B. Freeman, 1991. "Immigration, Trade and the Labor Market," NBER Books, National Bureau of Economic Research, Inc, number abow91-1, October.
  15. David Gray & Jeffrey Mills & Sourushe Zandvakili, 2003. "Immigration, Assimilation and Inequality of Income Distribution in Canada," University of Cincinnati, Economics Working Papers Series, University of Cincinnati, Department of Economics 2003-01, University of Cincinnati, Department of Economics.
  16. Madeline Zavodny, 1997. "Welfare and the locational choices of new immigrants," Economic and Financial Policy Review, Federal Reserve Bank of Dallas, Federal Reserve Bank of Dallas, issue Q II, pages 2-10.
  17. Mussaddeq Chowdhury & Roberto Pedace, 2007. "Ethnic Enclaves And Labor Markets: An Analysis Of Immigrant Outcomes In California," Contemporary Economic Policy, Western Economic Association International, vol. 25(2), pages 238-249, 04.
  18. Morissette, Rene & Frenette, Marc, 2003. "Will They Ever Converge? Earnings of Immigrants and Canadian-born Workers over the Last Two Decades," Analytical Studies Branch Research Paper Series 2003215e, Statistics Canada, Analytical Studies Branch.
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