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Immigrant Job Search Assimilation in Canada

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Abstract

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.

Suggested Citation

  • Audra J. Bowlus & Masashi Miyairi & Chris Robinson, 2013. "Immigrant Job Search Assimilation in Canada," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 20136, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).
  • Handle: RePEc:uwo:hcuwoc:20136
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    References listed on IDEAS

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    1. 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 119-131, Suppl. De.
    2. Deepti Goel & Kevin Lang, 2009. "Social Ties and the Job Search of Recent Immigrants," NBER Working Papers 15186, National Bureau of Economic Research, Inc.
    3. 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.
    4. 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.
    5. 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.
    6. 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.
    7. 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 482-492, August.
    8. 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.
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    10. Ortega, Javier, 2000. "Pareto-Improving Immigration in an Economy with Equilibrium Unemployment," Economic Journal, Royal Economic Society, vol. 110(460), pages 92-112, January.
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    12. 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.
    13. Paul Frijters & Michael A. Shields & Stephen Wheatley Price, 2005. "Job Search Methods and Their Success: A Comparison of Immigrants and Natives in the UK," Economic Journal, Royal Economic Society, vol. 115(507), pages 359-376, November.
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    15. 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, Department of Economics and Business Economics, Aarhus University.
    16. Deepti Goel & Kevin Lang, 2009. "Social Ties and the Job Search of Recent Immigrants," NBER Working Papers 15186, National Bureau of Economic Research, Inc.
    17. Zhang, Yahong, 2012. "A search interpretation of the family gap," Labour Economics, Elsevier, vol. 19(2), pages 186-197.
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    1. How do immigrants assimilate in job search?
      by Economic Logician in Economic Logic on 2013-12-06 22:09:00

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    1. Nabanita Datta Gupta & Lene Kromann, 2014. "Differences in the labor market entry of second-generation immigrants and ethnic Danes," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 3(1), pages 1-22, December.

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    Keywords

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    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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