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Immigrant Job Search Assimilation in Canada

Immigrant assimilation is a major issue in many countries. While most of the literature studies assimilation through a human capital framework, we examine the role of job search assimilation. To do so, we estimate an equilibrium search model of immigrants operating in the same labor market as natives, where newly arrived immigrants have lower job offer arrival rates than natives but can acquire the same arrival rates according to a stochastic process. Using Canadian panel data, we find substantial differences in job offer arrival and destruction rates between natives and immigrants that are able to account for three fifths of the observed earnings gap. The estimates imply that immigrants take, on average, 13 years to acquire the native search parameters. The job search assimilation process generates 18% earnings growth for immigrants in a 40 year period following migration.

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Paper provided by University of Western Ontario, CIBC Centre for Human Capital and Productivity in its series University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers with number 20136.

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Date of creation: 2013
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Handle: RePEc:uwo:hcuwoc:20136
Contact details of provider: Postal: CIBC Centre for Human Capital and Productivity, Social Science Centre, University of Western Ontario, London, Ontario, Canada N6A 5C2
Phone: 519-661-2111 Ext.85244
Web page: http://economics.uwo.ca/research/research_papers/cibc_workingpapers.html

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  1. Deepti Goel & Kevin Lang, 2010. "Social Ties and the Job Search of Recent Immigrants," Working papers 189, Centre for Development Economics, Delhi School of Economics.
  2. Baker, Michael & Benjamin, Dwayne, 1994. "The Performance of Immigrants in the Canadian Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 12(3), pages 369-405, July.
  3. Ana Ferrer & W. Craig Riddell, 2008. "Education, credentials, and immigrant earnings," Canadian Journal of Economics, Canadian Economics Association, vol. 41(1), pages 186-216, February.
  4. Liu, Xiangbo, 2010. "On the macroeconomic and welfare effects of illegal immigration," Journal of Economic Dynamics and Control, Elsevier, vol. 34(12), pages 2547-2567, December.
  5. Zhang, Yahong, 2012. "A search interpretation of the family gap," Labour Economics, Elsevier, vol. 19(2), pages 186-197.
  6. Nabanita Datta Gupta & Lene Kromann, 2013. "An Equilibrium Search Model of the Labor Market Entry of Second-Generation Immigrants and Ethnic Danes," Economics Working Papers 2013-04, School of Economics and Management, University of Aarhus.
  7. repec:dgr:uvatin:19980113 is not listed on IDEAS
  8. Borjas, George J., 1999. "The economic analysis of immigration," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 28, pages 1697-1760 Elsevier.
  9. Kaivan Munshi, 2003. "Networks In The Modern Economy: Mexican Migrants In The U.S. Labor Market," The Quarterly Journal of Economics, MIT Press, vol. 118(2), pages 549-599, May.
  10. Bowlus, Audra J & Kiefer, Nicholas M & Neumann, George R, 1995. "Estimation of Equilibrium Wage Distributions with Heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 10(S), pages S119-31, Suppl. De.
  11. Flinn, Christopher J, 2002. "Labour Market Structure and Inequality: A Comparison of Italy and the U.S," Review of Economic Studies, Wiley Blackwell, vol. 69(3), pages 611-45, July.
  12. Chassamboulli, Andri & Palivos, Theodore, 2010. ""Give me your Tired, your Poor," so I can Prosper: Immigration in Search Equilibrium," MPRA Paper 32379, University Library of Munich, Germany.
  13. Ortega, Javier, 2000. "Pareto-Improving Immigration in an Economy with Equilibrium Unemployment," Economic Journal, Royal Economic Society, vol. 110(460), pages 92-112, January.
  14. Dechief, Diane & Oreopoulos, Philip, 2012. "Why do some employers prefer to interview Matthew but not Samir? New evidence from Toronto, Montreal and Vancouver," CLSSRN working papers clsrn_admin-2012-8, Vancouver School of Economics, revised 19 Feb 2012.
  15. Arthur Sweetman & Casey Warman, 2013. "Canada's Immigration Selection System and Labour Market Outcomes," Canadian Public Policy, University of Toronto Press, vol. 39(s1), pages 141-160, May.
  16. Daneshvary, Nasser, et al, 1992. "Job Search and Immigrant Assimilation: An Earnings Frontier Approach," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 482-92, August.
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