The Wage Premium of Foreign Education: New Evidence from Australia
AbstractWe study whether Australian employers recognise immigrants' education acquired abroad, and if so how. Using data from the Longitudinal Surveys of Immigrants in Australia, we apply interval regression to model migrant hourly earnings. We find substantially higher returns from human capital obtained in Australia and other OECD countries compared with non-OECD countries. These results suggest that the transfer of human capital acquired abroad is mediated by the country in which it was acquired, as found for Israel (Friedberg (2000) and the US (Bratsberg and Ragan (2002)). The results also suggest that immigrants from non-OECD countries are the ones who can gain the most from obtaining further education in Australia, and that targeted rather than generic policies in this area could reduce the extent of the education-occupation mismatch amongst immigrants.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6578.
Length: 21 pages
Date of creation: May 2012
Date of revision:
Publication status: published in Australian Economic Review, 2013, 46(4), 395-404
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Other versions of this item:
- Massimiliano Tani & Christopher Heaton & Gavin Chan, 2013. "The Wage Premium of Foreign Education: New Evidence from Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 46(4), pages 395-404, December.
- C34 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Truncated and Censored Models; Switching Regression Models
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-06-25 (All new papers)
- NEP-EDU-2012-06-25 (Education)
- NEP-LAB-2012-06-25 (Labour Economics)
- NEP-LMA-2012-06-25 (Labor Markets - Supply, Demand, & Wages)
- NEP-LTV-2012-06-25 (Unemployment, Inequality & Poverty)
- NEP-MIG-2012-06-25 (Economics of Human Migration)
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