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A Life-Cycle Model of Outmigration and Economic Assimilation of Immigrants in Germany

Listed author(s):
  • Bellemare, C.

    (Tilburg University, Center For Economic Research)

This paper estimates a structural dynamic life-cycle model of outmigration where, in each period, immigrants choose whether to work in the host country, not to work but remain in the host country, or outmigrate.The model incorporates several features of existing life-cycle theories of outmigration but distinguishes itself by introducing uncertainty in about future earnings and preferences which allows immigrants to revise their duration decisions throughout their migration experience.Because immigrants simultaneously face a migration and a work decision in each period, the economic assimilation rates commonly used to assess the performance of immigrants in the host economy are endogenously determined and estimated, a feature previously ignored in the literature.We overcome the problem of not directly observing outmigration movements by using panel attrition as a proxy variable and use a simple method to correct for the fact that part of the attrition is not a consequence of outmigration.Estimates are used to predict changes in life-cycle patterns of outmigration behavior.Estimation results indicate that outmigration does not depend exclusively on earnings differentials.Estimated assimilation rates are found to be robust to selection effects.Immigrants are found to be forward looking decision makers, and simulations show that predicted migration durations are very sensitive to changes in their economic environment and differ considerably from those of a myopic model.

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File URL: https://pure.uvt.nl/portal/files/600917/29.pdf
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Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2004-29.

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Date of creation: 2004
Handle: RePEc:tiu:tiucen:b1d1686c-ab07-4e19-905a-d2e8d9585879
Contact details of provider: Web page: http://center.uvt.nl

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  33. Darren Lubotsky, 2000. "Chutes or Ladders? A Longitudinal Analysis of Immigrant Earnings," Working Papers 824, Princeton University, Department of Economics, Industrial Relations Section..
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  36. William A. V. Clark & Anita I. Drever, 2001. "Do Immigrants Improve Their Housing Quality When They Move?: Evidence from the German Socio-Economic Panel," Vierteljahrshefte zur Wirtschaftsforschung / Quarterly Journal of Economic Research, DIW Berlin, German Institute for Economic Research, vol. 70(1), pages 87-94.
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