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Are immigrants so stuck to the floor that the ceiling is irrelevant?

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Author Info
Hunt, Priscillia (University of Warwick)

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Abstract

In this paper, the immigrant-native wage differential is explained through quantile regression estimations. Using repeated cross-sections of the British Labour Force Survey from 1993-2005, we analyse the returns to covariates across the conditional earnings distribution. We estimate a pooled model with an immigrant dummy and separate models for immigrants and natives of the UK. Our results show that the positive wage gap in favour of immigrants is attributed to those at higher quantiles. Returns to education and experience vary wider for natives than for immigrants. We decompose the wage gap in the Blinder-Oaxaca framework and apply quantile regression techniques to see if immigrants simply have more viable labour market characteristics than natives or if there is a preference for immigrant workers (reverse discrimination). Our findings suggest immigrants should actually be earning more and there is sufficient evidence of discrimination. This finding is, however, not symmetric across the conditional wage distribution and immigrants atthe bottom face more discrimination than those at the top.

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Paper provided by University of Warwick, Department of Economics in its series The Warwick Economics Research Paper Series (TWERPS) with number 838.

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Length: 36 pages
Date of creation: 2008
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Handle: RePEc:wrk:warwec:838

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Related research
Keywords: immigration ; wage differential ; quantile regression ; Blinder-Oaxaca ; decomposition;

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Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers
J71 - Labor and Demographic Economics - - Labor Discrimination - - - Hiring and Firing

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  2. Chiswick, Barry R. & Hurst, Michael E., 2000. "The Employment, Unemployment and Unemployment Compensation Benefits of Immigrants," IZA Discussion Papers 129, Institute for the Study of Labor (IZA). [Downloadable!]
  3. Kristin F. Butcher & John DiNardo, 1998. "The Immigrant and Native-born Wage Distributions: Evidence from United States Censuses," NBER Working Papers 6630, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. James Albrecht & Anders Bjorklund & Susan Vroman, 2003. "Is There a Glass Ceiling in Sweden?," Journal of Labor Economics, University of Chicago Press, vol. 21(1), pages 145-177, January. [Downloadable!]
    Other versions:
  5. Melly, Blaise, 2005. "Decomposition of differences in distribution using quantile regression," Labour Economics, Elsevier, vol. 12(4), pages 577-590, August. [Downloadable!] (restricted)
  6. Green, Francis & Machin, Stephen & Wilkinson, David, 1998. "The Meaning and Determinants of Skills Shortages," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 60(2), pages 165-87, May.
  7. Gianmarco I.P. Ottaviano & Giovanni Peri, 2005. "Rethinking the Gains from Immigration: Theory and Evidence from the U.S," NBER Working Papers 11672, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  8. Cotton, Jeremiah, 1988. "On the Decomposition of Wage Differentials," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 236-43, May. [Downloadable!] (restricted)
  9. Barry R. Chiswick & Anh T. Le & Paul W. Miller, 2006. "How Immigrants Fare Across the Earnings Distribution: International Analyses," IZA Discussion Papers 2405, Institute for the Study of Labor (IZA). [Downloadable!]
  10. Ken Clark & Joanne Lindley, 2006. "Immigrant Labour Market Assimilation and Arrival Effects: Evidence from the UK Labour Force Survey," IZA Discussion Papers 2228, Institute for the Study of Labor (IZA). [Downloadable!]
  11. Lee, Sokbae, 2007. "Endogeneity in quantile regression models: A control function approach," Journal of Econometrics, Elsevier, vol. 141(2), pages 1131-1158, December. [Downloadable!] (restricted)
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  12. Chiswick, Barry R, 1980. "The Earnings of White and Coloured Male Immigrants in Britain," Economica, London School of Economics and Political Science, vol. 47(185), pages 81-87, February. [Downloadable!] (restricted)
  13. Borjas, George J, 1987. "Self-Selection and the Earnings of Immigrants," American Economic Review, American Economic Association, vol. 77(4), pages 531-53, September. [Downloadable!] (restricted)
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Cited by:
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  1. Muñoz de Bustillo, Rafael & Carrera, Miguel & Antón, José-Ignacio, 2009. "From guests to hosts: a first whole picture of immigrant-native wage differentials in Spain," MPRA Paper 13928, University Library of Munich, Germany. [Downloadable!]
  2. Antón, José-Ignacio & Carrera, Miguel & Muñoz de Bustillo, Rafael, 2009. "How are you doing in your grandpa’s country? Labour market performance of Latin American immigrants in Spain," MPRA Paper 15051, University Library of Munich, Germany. [Downloadable!]
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