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Does citizenship matter? The economic impact of naturalizations in Germany

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  • Max Friedrich Steinhardt

    () (Centro Studi Luca d’Agliano and Hamburg Institute of International Economics)

Abstract

The paper analyzes whether citizenship acquisition affects the labor market performance of immigrants in Germany. The study uses actual micro data from the IAB employment sample, which covers more than 80% of the whole labor force in Germany. The econometric analysis is carried out using both cross-sectional and panel data techniques, which allow to disentangle the effects of self-selection and legal impact of citizenship acquisition. The estimates from a simple OLS specification suggest the existence of a wage premium of naturalized immigrants. Panel estimates show an immediate positive naturalization effect on wages and an accelerated wage growth in the years after the naturalization event. Both results are consistent with the argument that naturalization increases the labor market opportunities of immigrants in various ways.

Suggested Citation

  • Max Friedrich Steinhardt, 2008. "Does citizenship matter? The economic impact of naturalizations in Germany," Development Working Papers 266, Centro Studi Luca d'Agliano, University of Milano.
  • Handle: RePEc:csl:devewp:266
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    File URL: http://www.dagliano.unimi.it/media/wp2008_266.pdf
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. 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.
    2. 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).
    3. 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.
    4. 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.
    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. 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.
    7. repec:bla:intmig:v:51:y:2017:i:2:p:323-343 is not listed on IDEAS
    8. 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).
    9. Aysegul KAYAOGLU & Ayhan KAYA, 2011. "Is National Citizenship Withering Away? : Social Affiliations and Labor Market Integration of Turkish Origin Immigrants in Germany and France," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2011033, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    10. 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.
    11. Christina Gathmann, 2015. "Naturalization and citizenship: Who benefits?," IZA World of Labor, Institute for the Study of Labor (IZA), pages 125-125, February.
    12. 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.
    13. Pieter Bevelander and Ravi Pendakur, 2012. "Citizenship acquisition, employment prospects and earnings: comparing two cool countries," EUI-RSCAS Working Papers 7, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
    14. Ilić, Dragan, 2016. "Prejudice in Naturalization Decisions: Theory and Evidence," Working papers 2016/04, Faculty of Business and Economics - University of Basel.
    15. repec:wfo:wstudy:57884 is not listed on IDEAS
    16. Bevelander, Pieter & Pendakur, Ravi, 2011. "Citizenship and Employment – comparing two cool countries," CEPR Discussion Papers 8182, C.E.P.R. Discussion Papers.
    17. Peter Huber, 2015. "What Institutions help immigrants Integrate?," WWWforEurope Working Papers series 77, WWWforEurope.
    18. 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.
    19. 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.
    20. 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 for the Study of Labor (IZA).
    21. Joachim Jarreau, 2015. "The Impact of Naturalizations on Job Mobility and Wages: Evidence from France," Working Papers halshs-01117449, HAL.
    22. repec:eee:jeborg:v:150:y:2018:i:c:p:1-18 is not listed on IDEAS
    23. repec:spr:izamig:v:8:y:2018:i:1:d:10.1186_s40176-017-0107-1 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.

    More about this item

    Keywords

    Naturalization; self-selection; socioeconomic 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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