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Wage discrimination and occupational segregation of foreign male workers in Germany

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  • Velling, Johannes
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    Abstract

    We analyze wage discrimination against foreign male workers in Germany with respect to different nationality groups and focused on its interaction with occupational segregation. We found evidence of strong occupational segregation, which we mainly attribute to institutional factors but also to different endowments with human capital. For the measurement of wage discrimination itself we applied a tobit estimation procedure to the wage equation and carried out the usual Blinder/Oaxaca decomposition in the second step. We found a slight discrimination against all foreign male workers together, but considerably greater discrimination for some nationality groups such as East Europeans and persons from the Middle and Far East. The additional consideration of occupational segregation did not affect these results much. However, by far most 'of the wage differentials between Germans and foreign nationality groups could be attributed to different endowments with human capital. --

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    Bibliographic Info

    Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 95-04.

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    Date of creation: 1995
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    Handle: RePEc:zbw:zewdip:9504

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    Keywords: Discrimination; occupational segregation; foreigners;

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    References

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    1. Mark B. Stewart, 1982. "Racial Discrimination and Occupational Attainment in Britain," Working Papers 538, Princeton University, Department of Economics, Industrial Relations Section..
    2. Licht, Georg & Steiner, Viktor, 1993. "Assimilation, labour market experience, and earnings profiles of temporary and permanent immigrant workers in germany," ZEW Discussion Papers 93-06, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    3. Oaxaca, Ronald L. & Ransom, Michael R., 1994. "On discrimination and the decomposition of wage differentials," Journal of Econometrics, Elsevier, vol. 61(1), pages 5-21, March.
    4. Dustmann, C, 1993. "Earnings Adjustment of Temporary Migrants," Journal of Population Economics, Springer, vol. 6(2), pages 153-68, May.
    5. Reimers, Cordelia W, 1983. "Labor Market Discrimination against Hispanic and Black Men," The Review of Economics and Statistics, MIT Press, vol. 65(4), pages 570-79, November.
    6. Gilles Grenier, 1984. "The Effects of Language Characteristics on the Wages of Hispanic-American Males," Journal of Human Resources, University of Wisconsin Press, vol. 19(1), pages 35-52.
    7. Pischke, Jörn-Steffen, 1992. "Assimilation and the earnings of guestworkers in Germany," ZEW Discussion Papers 92-17, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    8. David Neumark, 1987. "Employers' discriminatory behavior and the estimation of wage discrimination," Special Studies Papers 227, Board of Governors of the Federal Reserve System (U.S.).
    9. Chiswick, Barry R, 1978. "The Effect of Americanization on the Earnings of Foreign-born Men," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 897-921, October.
    10. Cotton, Jeremiah, 1988. "On the Decomposition of Wage Differentials," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 236-43, May.
    11. Butler, Richard J., 1987. "New indices of segregation," Economics Letters, Elsevier, vol. 24(4), pages 359-362.
    12. Deutsch, Joseph & Fluckiger, Yves & Silber, Jacques, 1994. "Measuring occupational segregation : Summary statistics and the impact of classification errors and aggregation," Journal of Econometrics, Elsevier, vol. 61(1), pages 133-146, March.
    13. Blau, Francine D & Ferber, Marianne A, 1987. "Discrimination: Empirical Evidence from the United States," American Economic Review, American Economic Association, vol. 77(2), pages 316-20, May.
    14. Knut Gerlach, 1987. "A Note on Male-Female Wage Differences in West Germany," Journal of Human Resources, University of Wisconsin Press, vol. 22(4), pages 584-592.
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    Cited by:
    1. Panagiotis Nanos & Christian Schluter, 2013. "The Composition of Wage Differentials between Migrants and Natives," Papers 1306.1781, arXiv.org, revised Oct 2013.
    2. Constant, Amelie F. & Massey, Douglas S., 2003. "Labor Market Segmentation and the Earnings of German Guestworkers," IZA Discussion Papers 774, Institute for the Study of Labor (IZA).
    3. Bella Struminskaya, 2011. "Selbständigkeit von Personen mit Migrationshintergrund in Deutschland: Ursachen ethnischer Unternehmung," SOEPpapers on Multidisciplinary Panel Data Research 418, DIW Berlin, The German Socio-Economic Panel (SOEP).
    4. Stefan M. Golder, 2000. "Endowment or Discrimination? An Analysis of Immigrant–Native Earnings Differentials in Switzerland," Kiel Working Papers 967, Kiel Institute for the World Economy.
    5. Steiner, Viktor & Wagner, Kersten, 1996. "Has earnings inequality in Germany changed in the 1980's?," ZEW Discussion Papers 96-32, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    6. Golder, Stefan M. & Straubhaar, Thomas, 1999. "Discrimination in the Swiss Labour Market: an Empirical Analysis," CEPR Discussion Papers 2100, C.E.P.R. Discussion Papers.

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