An Empirical Investigation of the Impact of Imperfect Information on Wages in Canada
Most studies of wage differentials explain such differentials in terms of factors like gender, race, and human capital. But systematic gaps in earnings can arise even among homogenous individuals as a result of asymmetric employer and worker information gaps, thereby reflecting labour market inefficiency. This paper estimates these gaps in terms of wage differentials across various population groups in Canada. We examine 21 populations groups, which include a number of immigrant groups as well. Information gaps are likely to be important in the context of immigrants, especially those new to Canadian labour markets. Our special interest is not only to compare information gaps of immigrant and other population groups, but also to assess whether (and how) immigrant information gaps depend upon the length of residence in Canada. The econometric model we employ is the two-tier stochastic earnings frontier, which is estimated using data from the 2001, 1996 and 1991 censuses.
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.:
- van Ours, J.C. & Ridder, G., 1992. "Vacancies and recruitment of new employees," Other publications TiSEM 9acc708a-0885-46a2-aef5-7, Tilburg University, School of Economics and Management.
- Groot, W. & Oosterbeek, H., 1995.
"Stochastic reservation and offer wages,"
Elsevier, vol. 2(1), pages 107-107, March.
- Daneshvary, Nasser, et al, 1992. "Job Search and Immigrant Assimilation: An Earnings Frontier Approach," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 482-492, August.
- Borjas, George J, 1985. "Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants," Journal of Labor Economics, University of Chicago Press, vol. 3(4), pages 463-489, October.
- Bruce C. Greenwald, 1986. "Adverse Selection in the Labour Market," Review of Economic Studies, Oxford University Press, vol. 53(3), pages 325-347.
- Guenter Lang, 2004. "How Different are Wages from Wage Potentials? - Analyzing the earnings disadvantage of immigrants in Germany," Discussion Paper Series 256, Universitaet Augsburg, Institute for Economics.
- Baker, Michael & Benjamin, Dwayne, 1994. "The Performance of Immigrants in the Canadian Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 12(3), pages 369-405, July.
- van Ours, Jan & Ridder, Geert, 1992. "Vacancies and the Recruitment of New Employees," Journal of Labor Economics, University of Chicago Press, vol. 10(2), pages 138-155, April.
- Anthony Murphy & Eric Strobl, 2008. "Employer and Employee Ignorance in Developing Countries: The Case of Trinidad and Tobago," Review of Development Economics, Wiley Blackwell, vol. 12(2), pages 339-353, 05.
When requesting a correction, please mention this item's handle: RePEc:ags:reapec:50162. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.