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Immigrant earnings growth: selection bias or real progress?

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  • Garnett Picot
  • Patrizio Piraino

Abstract

We use longitudinal tax data linked to immigrant landing records to study the effect of selective attrition on the estimated earnings assimilation of immigrants to Canada. Contrary to findings in the existing international literature, we show that the immigrant‐native earnings gap closes at the same pace in longitudinal and cross‐sectional data. Low‐earning immigrants are likely to leave the cross‐sectional samples over time, but the same is true for the native born. Our study suggests that immigrants to Canada have labour market participation dynamics similar to those of the native born. Croissance des gains des immigrants: biais de sélection ou progrès réel? On utilise des données fiscales longitudinales qu'on peut connecter aux dossiers d'immigration pour étudier les effets de l'attrition sélective sur l'intégration estimée des gains des immigrants à ceux des gens du lieu au Canada. Contrairement à des résultats publiés dans la littérature internationale sur cette question, on montre que l’écart de gains entre immigrants et Canadiens de souche se réduit au même rythme dans les données longitudinales et transversales. Alors que les immigrants dont les gains sont faibles sont davantage susceptibles de quitter les échantillons transversaux dans le temps, la même chose est vraie pour les Canadiens de souche. L’étude suggère que les immigrants au Canada ont la même dynamique de participation au marché du travail que les Canadiens de souche.

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  • Garnett Picot & Patrizio Piraino, 2013. "Immigrant earnings growth: selection bias or real progress?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 46(4), pages 1510-1536, November.
  • Handle: RePEc:wly:canjec:v:46:y:2013:i:4:p:1510-1536
    DOI: 10.1111/caje.12053
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    Cited by:

    1. Dostie, Benoit & Li, Jiang & Card, David & Parent, Daniel, 2023. "Employer policies and the immigrant–native earnings gap," Journal of Econometrics, Elsevier, vol. 233(2), pages 544-567.
    2. Dustmann, Christian & Görlach, Joseph-Simon, 2016. "Estimating immigrant earnings profiles when migrations are temporary," Labour Economics, Elsevier, vol. 41(C), pages 1-8.
    3. Casey Warman & Matthew D. Webb & Christopher Worswick, 2019. "Immigrant category of admission and the earnings of adults and children: how far does the apple fall?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 32(1), pages 53-112, January.
    4. David A. Green & Christopher Worswick, 2017. "Canadian economics research on immigration through the lens of theories of justice," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 50(5), pages 1262-1303, December.
    5. Haozhen Zhang & Jianwei Zhong & Cédric de Chardon, 2020. "Immigrants’ net direct fiscal contribution: How does it change over their lifetime?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 53(4), pages 1642-1662, November.
    6. Neeraj Kaushal & Yao Lu & Nicole Denier & Julia Shu-Huah Wang & Stephen J. Trejo, 2016. "Immigrant employment and earnings growth in Canada and the USA: evidence from longitudinal data," Journal of Population Economics, Springer;European Society for Population Economics, vol. 29(4), pages 1249-1277, October.
    7. Arthur Sweetman & Casey Warman, 2013. "Canada's Immigration Selection System and Labour Market Outcomes," Canadian Public Policy, University of Toronto Press, vol. 39(s1), pages 141-160, May.
    8. Audra J. Bowlus & Masashi Miyairi & Chris Robinson, 2016. "Immigrant job search assimilation in Canada," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 49(1), pages 5-51, February.
    9. Green, David A. & Worswick, Christopher, 2012. "Immigrant earnings profiles in the presence of human capital investment: Measuring cohort and macro effects," Labour Economics, Elsevier, vol. 19(2), pages 241-259.
    10. Michele Campolieti & Morley Gunderson & Olga Timofeeva & Evguenia Tsiroulnitchenko, 2013. "Immigrant Assimilation, Canada 1971–2006: Has the Tide Turned?," Journal of Labor Research, Springer, vol. 34(4), pages 455-475, December.
    11. Ana Damas de Matos, 2017. "Firm heterogeneity and immigrant wage assimilation," Applied Economics Letters, Taylor & Francis Journals, vol. 24(9), pages 653-657, May.

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    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

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