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Social Capital and Immigrants' Labour Market Performance

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Author Info

  • Piracha, Matloob

    ()
    (University of Kent)

  • Tani, Massimiliano

    ()
    (IZA)

  • Vaira-Lucero, Matias

    ()
    (Macquarie University, Sydney)

Abstract

This paper analyses the role of social capital on immigrants' labour market outcomes. We use the "principal component analysis" (PCA) to build an index of social networks and explore its impact on the probability of getting a job and on wage levels using the Households Income and Labour Dynamics in Australia (HILDA) longitudinal survey data. We find a positive effect of social capital on migrants' employment outcomes and wages, especially for women. Distinguishing employment into blue and white-collar jobs, we find that social capital only affects the probability of getting a white-collar job. These results suggest that promoting opportunities to create social capital has a beneficial effect on migrants' integration in the host country.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7274.

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Length: 29 pages
Date of creation: Mar 2013
Date of revision:
Publication status: Forthcoming in: Papers in Regional Science
Handle: RePEc:iza:izadps:dp7274

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Related research

Keywords: immigrants; labour market; social capital; HILDA survey; Australia;

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  1. Douglas Staiger & James H. Stock, 1994. "Instrumental Variables Regression with Weak Instruments," NBER Technical Working Papers 0151, National Bureau of Economic Research, Inc.
  2. Calvo-Armengol, Antoni & Zenou, Yves, 2005. "Job matching, social network and word-of-mouth communication," Journal of Urban Economics, Elsevier, vol. 57(3), pages 500-522, May.
  3. Hausman, Jerry A & Taylor, William E, 1981. "Panel Data and Unobservable Individual Effects," Econometrica, Econometric Society, vol. 49(6), pages 1377-98, November.
  4. Chamberlain, Gary, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Wiley Blackwell, vol. 47(1), pages 225-38, January.
  5. Antoni Calvó-Armengol & Matthew O. Jackson, 2004. "The Effects of Social Networks on Employment and Inequality," American Economic Review, American Economic Association, vol. 94(3), pages 426-454, June.
  6. Wendy Stone & Matthew Gray & Jody Huges, 2004. "Social capital at work How family, friends and civic ties relate to labour market outcomes," Others 0408005, EconWPA.
  7. Yannis M. Ioannides & Linda Datcher Loury, 2002. "Job Information Networks, Neighborhood Effects and Inequality," Discussion Papers Series, Department of Economics, Tufts University 0217, Department of Economics, Tufts University.
  8. Deri, Catherine, 2005. "Social networks and health service utilization," Journal of Health Economics, Elsevier, vol. 24(6), pages 1076-1107, November.
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