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Does citizenship matter? The economic impact of naturalizations in Germany

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  • Steinhardt, Max Friedrich

Abstract

This paper analyses whether citizenship acquisition affects the labour market performance of immigrants in Germany. The study uses actual micro data from the employment sample of the Institute for Employment Research, which covers more than 80% of the entire labour force in Germany. The econometric analysis has been carried out using panel data techniques, which allow to disentangle the effects of self-selection and legal impact of citizenship acquisition. Estimates from a pooled OLS specification suggest the existence of a wage premium for naturalized immigrants of both genders. Fixed effects estimates for males show an increased wage growth in the years following naturalization, consistent with the argument that naturalization increases the labour market opportunities of immigrants. Results for female employees indicate that the wage premium of naturalized women is solely the result of a positive self-selection process.

Suggested Citation

  • Steinhardt, Max Friedrich, 2012. "Does citizenship matter? The economic impact of naturalizations in Germany," Labour Economics, Elsevier, vol. 19(6), pages 813-823.
  • Handle: RePEc:eee:labeco:v:19:y:2012:i:6:p:813-823
    DOI: 10.1016/j.labeco.2012.09.001
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    Cited by:

    1. Facundo Albornoz & Antonio Cabrales & Esther Hauk, 2018. "Immigration and the school system," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 65(4), pages 855-890, June.
    2. Steinhardt Max Friedrich, 2011. "The Wage Impact of Immigration in Germany - New Evidence for Skill Groups and Occupations," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-35, June.
    3. Ivana Fellini & Raffaele Guetto, 2019. "Legal Status and Immigrants’ Labour Market Outcomes: Comparative Evidence from a Quasi-Experiment in Western and Southern Europe," Econometrics Working Papers Archive 2019_11, Universita' degli Studi di Firenze, Dipartimento di Statistica, Informatica, Applicazioni "G. Parenti".
    4. Tolciu, Andreia & Schaland, Ann-Julia & El-Cherkeh, Tanja, 2010. "Migrant entrepreneurship in Hamburg: Results from a qualitative study with Turkish entrepreneurs," HWWI Research Papers 3-22, Hamburg Institute of International Economics (HWWI).
    5. Ciro Avitabile & Irma Clots-Figueras & Paolo Masella, 2013. "The Effect of Birthright Citizenship on Parental Integration Outcomes," Journal of Law and Economics, University of Chicago Press, vol. 56(3), pages 777-810.
    6. Vahan Sargsyan, 2017. "Treatment-Related Naturalization Premiums in Two European Countries: Evaluation and Comparison," CERGE-EI Working Papers wp585, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    7. Vernby, Kåre & Dancygier, Rafaela, 2018. "Employer discrimination and the immutability of ethnic hierarchies," Working Paper Series 2018:17, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    8. Jonas Helgertz & Pieter Bevelander & Anna Tegunimataka, 2014. "Naturalization and Earnings: A Denmark–Sweden Comparison," European Journal of Population, Springer;European Association for Population Studies, vol. 30(3), pages 337-359, August.
    9. Felfe, Christina & Kocher, Martin & Rainer, Helmut & Saurer, Judith & Siedler, Thomas, 2018. "More Opportunity, More Cooperation? The Behavioral Effects of Birthright Citizenship on Immigrant Youth," Economics Series 340, Institute for Advanced Studies.
    10. Keller, Nicolas & Gathmann, Christina & Monscheuer, Ole, 2015. "Citizenship and the Social Integration of Immigrants: Evidence from Germany's Immigration Reforms," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113184, Verein für Socialpolitik / German Economic Association.
    11. repec:bla:intmig:v:51:y:2017:i:2:p:323-343 is not listed on IDEAS
    12. Christina Gathmann & Nicolas Keller, 2014. "Returns to Citizenship?: Evidence from Germany's Recent Immigration Reforms," SOEPpapers on Multidisciplinary Panel Data Research 656, DIW Berlin, The German Socio-Economic Panel (SOEP).
    13. Sajons, Christoph, 2019. "Birthright citizenship and parental labor market integration," Labour Economics, Elsevier, vol. 57(C), pages 1-22.
    14. Amuedo-Dorantes, Catalina & Gratereaux Hernández, Carlos & Pozo, Susan, 2017. "On the Implications of Immigration Policy Restricting Citizenship: Evidence from the Dominican Republic," IZA Discussion Papers 10602, Institute of Labor Economics (IZA).
    15. Otto, Alkis Henri & Steinhardt, Max Friedrich, 2014. "Immigration and election outcomes — Evidence from city districts in Hamburg," Regional Science and Urban Economics, Elsevier, vol. 45(C), pages 67-79.
    16. Joachim Jarreau, 2015. "The Impact of Naturalizations on Job Mobility and Wages: Evidence from France," Working Papers halshs-01117449, HAL.
    17. Christina Gathmann, 2015. "Naturalization and citizenship: Who benefits?," IZA World of Labor, Institute of Labor Economics (IZA), pages 125-125, February.
    18. Vahan Sargsyan, 2018. "Social Integration of Immigrants and the Attitude of the Native Population in European Countries," CERGE-EI Working Papers wp629, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    19. Tommaso Frattini, 2017. "Integration of immigrants in host countries - what we know and what works," Development Working Papers 427, Centro Studi Luca d'Agliano, University of Milano, revised 10 Apr 2017.
    20. repec:eee:jeborg:v:150:y:2018:i:c:p:1-18 is not listed on IDEAS
    21. Ilić, Dragan, 2016. "Prejudice in Naturalization Decisions: Theory and Evidence," Working papers 2016/04, Faculty of Business and Economics - University of Basel.
    22. repec:spr:izamig:v:8:y:2018:i:1:d:10.1186_s40176-017-0107-1 is not listed on IDEAS
    23. repec:wfo:wstudy:57884 is not listed on IDEAS
    24. Vahan Sargsyan, 2015. "Differential Treatment in the Chinese Labor Market. Is Hukou Type the Only Problem?," CERGE-EI Working Papers wp548, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    25. Rezart Hoxhaj & Maarten Vink & Tijana Prokic-Breuer, 2019. "Immigrant Naturalisation, Employment and Occupational Status in Western Europe," RSCAS Working Papers 2019/16, European University Institute.

    More about this item

    Keywords

    Citizenship; Naturalization; Self-selection; Economic impact; Integration;

    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, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy

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