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Transferability of Human Capital and Immigrant Assimilation: An Analysis for Germany

Author

Listed:
  • Leilanie Basilio
  • Thomas K. Bauer
  • Anica Kramer

Abstract

This paper investigates the transferability of human capital across countries and the contribution of imperfect human capital portability to the explanation of the immigrant-native wage gap. Using data for West Germany, our results reveal that, overall, education and in particular labor market experience accumulated in the home countries of the immigrants receive signifiantly lower returns than human capital obtained in Germany. We further find evidence for heterogeneity in the returns to human capital of immigrants across countries. Finally, imperfect human capital transferability appears to be a major factor in explaining the wage differential between natives and immigrants.

Suggested Citation

  • Leilanie Basilio & Thomas K. Bauer & Anica Kramer, 2014. "Transferability of Human Capital and Immigrant Assimilation: An Analysis for Germany," SOEPpapers on Multidisciplinary Panel Data Research 671, DIW Berlin, The German Socio-Economic Panel (SOEP).
  • Handle: RePEc:diw:diwsop:diw_sp671
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    References listed on IDEAS

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    More about this item

    Keywords

    Human Capital; Rate of Return; Immigration; Assimilation;
    All these keywords.

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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