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Local signals and the returns to foreign education

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  • Tani, Massimiliano

Abstract

This paper studies whether assessing foreign education with its host country equivalent, as practised in Australia, raises migrants' returns to schooling. Using unawareness between degrees obtained abroad versus Australia as instrument for undertaking the assessment, I find substantial wage improvements when foreign qualifications are assessed in both cross-sectional and panel estimations. This result is not solely attributable to selection, as this would imply an unrealistic shift in the distribution of unobserved characteristics among assessed and not-assessed migrants. Adding a local signal to foreign education emerges as effective policy to improve the transferability of human capital and migrants' economic assimilation.

Suggested Citation

  • Tani, Massimiliano, 2017. "Local signals and the returns to foreign education," Economics of Education Review, Elsevier, vol. 61(C), pages 174-190.
    • Handle: RePEc:eee:ecoedu:v:61:y:2017:i:c:p:174-190
    DOI: 10.1016/j.econedurev.2017.07.006
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    Cited by:

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    More about this item

    Keywords

    Immigration; Foreign education; Statistical discrimination;
    All these keywords.

    JEL classification:

    • 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
    • J70 - Labor and Demographic Economics - - Labor Discrimination - - - General

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