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Why is the payoff to schooling smaller for immigrants?

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  • Chiswick, Barry R.
  • Miller, Paul W.

Abstract

To answer the question, this paper uses the Over-Required-Under Education technique, a new decomposition methodology and data on adult men from the 2000 US Census. Using the 510 three-digit occupational categories, similar patterns emerge whether the mean or mode of education in the occupation is used as the typical (required) level. The partial effect of the occupation's typical schooling level is the same for immigrants and natives. About two thirds of the smaller effect of schooling on earnings is attributable to differences by nativity in the payoffs to over/under education. The remainder is largely due to the different distributions by nativity of over/under education. Favorable immigrant selectivity, especially among the least skilled, and to a lesser extent, limited transferability of foreign schooling, is largely responsible for these patterns. A variety of tests of robustness are performed, including separate analyses for child and adult immigrants.

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Article provided by Elsevier in its journal Labour Economics.

Volume (Year): 15 (2008)
Issue (Month): 6 (December)
Pages: 1317-1340

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Handle: RePEc:eee:labeco:v:15:y:2008:i:6:p:1317-1340
Contact details of provider: Web page: http://www.elsevier.com/locate/labeco

Keywords: I21 J24 J31 J61 F22 Immigrants Schooling Occupations Earnings Rates of return Selectivity;

Other versions of this item:

Find related papers by JEL classification:
  • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
  • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
  • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
  • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
  • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

References listed on IDEAS
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  1. Richard Fry & B. Lindsay Lowell, 2003. "The Value of Bilingualism in the U.S. Labor Market," ILR Review, Cornell University, ILR School, vol. 57(1), pages 128-140, October.
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  21. Kalena E. Cortes, 2004. "Are Refugees Different from Economic Immigrants? Some Empirical Evidence on the Heterogeneity of Immigrant Groups in the United States," The Review of Economics and Statistics, MIT Press, vol. 86(2), pages 465-480, May.
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