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The Elusive Concept of Immigrant Quality: Evidence from 1970-1990

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  • Harriet Orcutt Duleep

    () (Thomas Jefferson Program in Public Policy, The College of William and Mary)

  • Mark C. Regets

    () (National Science Foundation)

Abstract

The labor market "quality" of immigrants is a subject of debate among immigration researchers, and a major public policy concern. However, traditional methods of measuring human capital are particularly difficult to apply to recently arrived immigrants. Many factors that have a negative effect on entry earnings also increase either the incentive or the opportunity for faster human capital investment and earning growth. In addition, many country-of-origin acquired skills that are not immediately valued in the U.S. labor market are useful to the acquisition of U.S. skills. Thus entry earnings are not a good measure of the stock of immigrant human capital. This article presents a model of immigrant human capital investment and, using 1970-1990 census data, presents strong evidence of a systematic and important inverse relationship between initial immigrant earnings and subsequent earnings growth. This result-which persists even after accounting for differences in the immigration flows from different countries, sampling error, and the effects of emigration - is fundamentally different from both earlier cross-sectional estimates and more recent pooled models that constrain cohort growth rates to be equal. Although our model provides theoretical support for an inverse relationship only when source country human capital is held constant, faster earnings growth for low-entry-earnings immigrants is found empirically even when age and education are not controlled for. The immigrant human capital investment model presented here explores general principles that may apply to other labor market transitions that involve skill transferability-including occupational change and labor market reentry.

Suggested Citation

  • Harriet Orcutt Duleep & Mark C. Regets, 2013. "The Elusive Concept of Immigrant Quality: Evidence from 1970-1990," Working Papers 138, Department of Economics, College of William and Mary.
  • Handle: RePEc:cwm:wpaper:138
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    References listed on IDEAS

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    1. David E. Bloom & Morley Gunderson, 1991. "An Analysis of the Earnings of Canadian Immigrants," NBER Chapters,in: Immigration, Trade, and the Labor Market, pages 321-342 National Bureau of Economic Research, Inc.
    2. Borjas, George J, 1985. "Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants," Journal of Labor Economics, University of Chicago Press, vol. 3(4), pages 463-489, October.
    3. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352-352.
    4. Green, David A, 1999. "Immigrant Occupational Attainment: Assimilation and Mobility over Time," Journal of Labor Economics, University of Chicago Press, vol. 17(1), pages 49-79, January.
    5. Robert F. Schoeni, 1997. "New Evidence on the Economic Progress of Foreign-Born Men in the 1970s and 1980s," Journal of Human Resources, University of Wisconsin Press, vol. 32(4), pages 683-740.
    6. Gang, Ira N & Rivera-Batiz, Francisco L, 1994. "Labor Market Effects of Immigration in the United States and Europe: Substitution vs. Complementarity," Journal of Population Economics, Springer;European Society for Population Economics, vol. 7(2), pages 157-175.
    7. Sherrie A. Kossoudji, 1989. "Immigrant Worker Assimilation: Is It a Labor Market Phenomenon?," Journal of Human Resources, University of Wisconsin Press, vol. 24(3), pages 494-527.
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    Cited by:

    1. Orrenius, Pia M. & Zavodny, Madeline, 2007. "Does immigration affect wages? A look at occupation-level evidence," Labour Economics, Elsevier, pages 757-773.
    2. Stephen J. Trejo, 2003. "Intergenerational Progress of Mexican-Origin Workers in the U.S. Labor Market," Journal of Human Resources, University of Wisconsin Press, vol. 38(3).
    3. Alcobendas, Miguel Angel & Rodríguez-Planas, Núria, 2009. "Immigrants' Assimilation Process in a Segmented Labor Market," IZA Discussion Papers 4394, Institute for the Study of Labor (IZA).
    4. George J. Borjas & Rachel M. Friedberg, 2009. "Recent Trends in the Earnings of New Immigrants to the United States," NBER Working Papers 15406, National Bureau of Economic Research, Inc.
    5. Sónia Cabral & Cláudia Duarte, 2013. "Mind the gap! The relative wages of immigrants in the Portuguese labour market," Working Papers w201305, Banco de Portugal, Economics and Research Department.
    6. Dustmann, Christian & Glitz, Albrecht, 2011. "Migration and Education," Handbook of the Economics of Education, Elsevier.
    7. Grenier, Gilles, 2001. "Immigration, langues et performance économique : le Québec et l’Ontario entre 1970 et 1995," L'Actualité Economique, Société Canadienne de Science Economique, vol. 77(3), pages 305-338, septembre.
    8. Darren Lubotsky, 2007. "Chutes or Ladders? A Longitudinal Analysis of Immigrant Earnings," Journal of Political Economy, University of Chicago Press, vol. 115(5), pages 820-867, October.
    9. Duleep, Harriet & Liu, Xingfei & Regets, Mark, 2014. "Country of Origin and Immigrant Earnings, 1960-2000: A Human Capital Investment Perspective," IZA Discussion Papers 8628, Institute for the Study of Labor (IZA).
    10. Ran Abramitzky & Leah Platt Boustan, 2016. "Immigration in American Economic History," NBER Working Papers 21882, National Bureau of Economic Research, Inc.
    11. Epstein, Gil S. & Gang, Ira N., 2008. "Ethnicity, Assimilation and Harassment in the Labor Market," IZA Discussion Papers 3591, Institute for the Study of Labor (IZA).
    12. Harriet Orcutt Duleep, 2013. "Country of Origin and Immigrant Earnings: Evidence from 1960-1990," Working Papers 131, Department of Economics, College of William and Mary.
    13. Serena Huang, 2011. "The international transferability of human capital in nursing," International Journal of Health Economics and Management, Springer, vol. 11(3), pages 145-163, September.
    14. Edward Funkhouser, 2000. "Convergence in Employment Rates of Immigrants," NBER Chapters,in: Issues in the Economics of Immigration, pages 143-184 National Bureau of Economic Research, Inc.
    15. Arbel, Yuval & Tobol, Yossi & Siniver, Erez, 2012. "Social Involvement and Level of Household Income among Immigrants: New Evidence from the Israeli Experience," IZA Discussion Papers 6416, Institute for the Study of Labor (IZA).
    16. Tse, Michael M. H. & Maani, Sholeh A., 2016. "The Labour Market Effect of Immigration: Accounting for Effective Immigrant Work Experience in New Zealand," IZA Discussion Papers 10422, Institute for the Study of Labor (IZA).
    17. repec:iza:izawol:journl:y:2017:n:389 is not listed on IDEAS
    18. Carl Lin, 2016. "How Do Immigrants From Taiwan Fare In The U.S. Labor Market?," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 61(05), pages 1-38, December.
    19. 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.
    20. Maude Toussaint-Comeau, 2016. "Mexican immigration, occupational clustering, and the local labor market adjustment of African-American workers," IZA Journal of Migration, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-31, December.
    21. Gil Epstein, 2009. "Willingness to Assimilate and Ethnicity," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 35, pages 1-1.

    More about this item

    Keywords

    immigration; migration; human capital investment; skill transferability; assimilation;

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J1 - Labor and Demographic Economics - - Demographic Economics

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