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Wage discrimination and occupational segregation of foreign male workers in Germany

  • Velling, Johannes
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    We analyze wage discrimination against foreign male workers in Germany with respect to different nationality groups and focused on its interaction with occupational segregation. We found evidence of strong occupational segregation, which we mainly attribute to institutional factors but also to different endowments with human capital. For the measurement of wage discrimination itself we applied a tobit estimation procedure to the wage equation and carried out the usual Blinder/Oaxaca decomposition in the second step. We found a slight discrimination against all foreign male workers together, but considerably greater discrimination for some nationality groups such as East Europeans and persons from the Middle and Far East. The additional consideration of occupational segregation did not affect these results much. However, by far most 'of the wage differentials between Germans and foreign nationality groups could be attributed to different endowments with human capital.

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    File URL: http://econstor.eu/bitstream/10419/29485/1/04392476X.pdf
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    Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 95-04.

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    Date of creation: 1995
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    Handle: RePEc:zbw:zewdip:9504
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    1. Knut Gerlach, 1987. "A Note on Male-Female Wage Differences in West Germany," Journal of Human Resources, University of Wisconsin Press, vol. 22(4), pages 584-592.
    2. Butler, Richard J., 1987. "New indices of segregation," Economics Letters, Elsevier, vol. 24(4), pages 359-362.
    3. Reimers, Cordelia W, 1983. "Labor Market Discrimination against Hispanic and Black Men," The Review of Economics and Statistics, MIT Press, vol. 65(4), pages 570-79, November.
    4. Dustmann, C, 1993. "Earnings Adjustment of Temporary Migrants," Journal of Population Economics, Springer, vol. 6(2), pages 153-68, May.
    5. Deutsch, Joseph & Fluckiger, Yves & Silber, Jacques, 1994. "Measuring occupational segregation : Summary statistics and the impact of classification errors and aggregation," Journal of Econometrics, Elsevier, vol. 61(1), pages 133-146, March.
    6. Diekmann, Andreas & Engelhardt, Henriette & Hartmann, Peter, 1993. "Einkommensungleichheit in der Bundesrepublik Deutschland : Diskriminierung von Frauen und Ausländern?," Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 26(3), pages 386-398.
    7. Stewart, Mark B, 1983. "Racial Discrimination and Occupational Attainment in Britain," Economic Journal, Royal Economic Society, vol. 93(371), pages 521-41, September.
    8. Andrew M. Gill, 1994. "Incorporating the Causes of Occupational Differences in Studies of Racial Wage Differentials," Journal of Human Resources, University of Wisconsin Press, vol. 29(1), pages 20-41.
    9. David Neumark, 1988. "Employers' Discriminatory Behavior and the Estimation of Wage Discrimination," Journal of Human Resources, University of Wisconsin Press, vol. 23(3), pages 279-295.
    10. Cotton, Jeremiah, 1988. "On the Decomposition of Wage Differentials," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 236-43, May.
    11. Blau, Francine D & Ferber, Marianne A, 1987. "Discrimination: Empirical Evidence from the United States," American Economic Review, American Economic Association, vol. 77(2), pages 316-20, May.
    12. Pischke, Jörn-Steffen, 1992. "Assimilation and the earnings of guestworkers in Germany," ZEW Discussion Papers 92-17, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    13. Chiswick, Barry R, 1978. "The Effect of Americanization on the Earnings of Foreign-born Men," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 897-921, October.
    14. Gilles Grenier, 1984. "The Effects of Language Characteristics on the Wages of Hispanic-American Males," Journal of Human Resources, University of Wisconsin Press, vol. 19(1), pages 35-52.
    15. Licht, Georg & Steiner, Viktor, 1993. "Assimilation, labour market experience, and earnings profiles of temporary and permanent immigrant workers in germany," ZEW Discussion Papers 93-06, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    16. Oaxaca, Ronald L. & Ransom, Michael R., 1994. "On discrimination and the decomposition of wage differentials," Journal of Econometrics, Elsevier, vol. 61(1), pages 5-21, March.
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