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Occupational Transition and Country-of-Origin Effects in the Early Stage Occupational Assimilation of Immigrants: Some Evidence from Australia

  • Weiping Kostenko

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Mark Harris

    (Department of Econometrics and Business Statistics, Monash University)

  • Xueyan Zhao

    (Department of Econometrics and Business Statistics, Monash University)

We examine the occupational attainment of recent immigrants at two years post migration in order to study their early stage assimilation into the labour market in Australia. Human capital endowments and country-of-origin effects are examined for six occupational groups (including unemployment). We also study transitions across occupations from source to host country. The empirical approach utilises the Ordered Generalised Extreme Value model which embodies differing utility functions across occupational outcomes, as well as accounting for any ordering in these outcomes. The results suggest that the transferability of knowledge and skills is affected by cultural and social backgrounds, and that non-Western immigrants are disproportionately channelled into inferior jobs post migration. The investigation of the country-of-origin effect on the skilled migrants' occupational transition process is especially apt in the context of skill shortages in many host countries.

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Paper provided by Melbourne Institute of Applied Economic and Social Research, The University of Melbourne in its series Melbourne Institute Working Paper Series with number wp2009n20.

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Length: 36 pages
Date of creation: Jul 2009
Date of revision:
Handle: RePEc:iae:iaewps:wp2009n20
Contact details of provider: Postal: Melbourne Institute of Applied Economic and Social Research, The University of Melbourne, Victoria 3010 Australia
Phone: +61 3 8344 2100
Fax: +61 3 8344 2111
Web page: http://www.melbourneinstitute.com/
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  1. Paul W. Miller & Paul A. Volker, 1985. "On the Determination of Occupational Attainment and Mobility," Journal of Human Resources, University of Wisconsin Press, vol. 20(2), pages 197-213.
  2. Sarah Brown & Lisa Farrell & Mark N. Harris & John G. Sessions, 2006. "Risk preference and employment contract type," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 169(4), pages 849-863.
  3. Stephane Mahuteau & P.N.(Raja) Junankar, 2004. "Do Migrants get Good Jobs? New Migrant Settlement in Australia," Econometric Society 2004 Australasian Meetings 150, Econometric Society.
  4. Friedberg, Rachel M, 2000. "You Can't Take It with You? Immigrant Assimilation and the Portability of Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 18(2), pages 221-51, April.
  5. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
  6. Stephen Wheatley Price, 2001. "The employment adjustment of male immigrants in England," Journal of Population Economics, Springer, vol. 14(1), pages 193-220.
  7. Small, Kenneth A, 1987. "A Discrete Choice Model for Ordered Alternatives," Econometrica, Econometric Society, vol. 55(2), pages 409-24, March.
  8. Cobb-Clark, Deborah A., 2002. "Public Policy and the Labor Market Adjustment of New Immigrants to Australia," IZA Discussion Papers 620, Institute for the Study of Labor (IZA).
  9. Schmidt, Peter & Strauss, Robert P, 1975. "The Prediction of Occupation Using Multiple Logit Models," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 16(2), pages 471-86, June.
  10. Harris, Mark N. & Ramful, Preety & Zhao, Xueyan, 2006. "An ordered generalised extreme value model with application to alcohol consumption in Australia," Journal of Health Economics, Elsevier, vol. 25(4), pages 782-801, July.
  11. Le, Anh T & Miller, Paul W, 2001. "Occupational Status: Why Do Some Workers Miss Out?," Australian Economic Papers, Wiley Blackwell, vol. 40(3), pages 352-72, September.
  12. Khan, Aliya Hashmi, 1997. "Post-migration investment in education by immigrants in the United States," The Quarterly Review of Economics and Finance, Elsevier, vol. 37(Supplemen), pages 285-313.
  13. Cramer, J. S. & Ridder, G., 1991. "Pooling states in the multinomial logit model," Journal of Econometrics, Elsevier, vol. 47(2-3), pages 267-272, February.
  14. Barry R. Chiswick & Yew Liang Lee & Paul W. Miller, 2002. "Longitudinal Analysis of Immigrant Occupational Mobility: A Test of the Immigrant Assimilation Hypothesis," Economics Discussion / Working Papers 02-08, The University of Western Australia, Department of Economics.
  15. Bauer, Thomas K. & Lofstrom, Magnus & Zimmermann, Klaus F., 2000. "Immigration Policy, Assimilation of Immigrants and Natives' Sentiments towards Immigrants: Evidence from 12 OECD-Countries," IZA Discussion Papers 187, Institute for the Study of Labor (IZA).
  16. Mahuteau, Stéphane & Junankar, Pramod N. (Raja), 2008. "Do Migrants Get Good Jobs in Australia? The Role of Ethnic Networks in Job Search," IZA Discussion Papers 3489, Institute for the Study of Labor (IZA).
  17. Stephen Wheatley Price, 2001. "The unemployment experience of male immigrants in England," Applied Economics, Taylor & Francis Journals, vol. 33(2), pages 201-215.
  18. Polachek, Solomon William, 1981. "Occupational Self-Selection: A Human Capital Approach to Sex Differences in Occupational Structure," The Review of Economics and Statistics, MIT Press, vol. 63(1), pages 60-69, February.
  19. 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.
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