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Do better pre-migration skills accelerate immigrants' wage assimilation?

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  • Hirsch, Boris
  • Jahn, Elke J.
  • Toomet, Ott
  • Hochfellner, Daniela

Abstract

This paper analyzes wage assimilation of ethnic German immigrants to Germany using unique administrative data that include an administrative estimate of immigrants' expected wage in Germany at the time of migration. We find that a 10% higher wage potential translates into a 1.6% higher wage in Germany when also controlling for educational attainment, thus pointing at partial transferability of pre-migration skills to the host country's labor market. We also document that wage assimilation is significantly accelerated for immigrants with higher wage potentials. Our results are both in line with complementarities between pre-migration skills and host country-specific human capital and a U-shaped pattern of immigrants' job mobility with initial downgrading and subsequent upgrading.

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  • Hirsch, Boris & Jahn, Elke J. & Toomet, Ott & Hochfellner, Daniela, 2014. "Do better pre-migration skills accelerate immigrants' wage assimilation?," Labour Economics, Elsevier, vol. 30(C), pages 212-222.
    • Handle: RePEc:eee:labeco:v:30:y:2014:i:c:p:212-222
    DOI: 10.1016/j.labeco.2014.04.004
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    Cited by:

    1. Hirsch, Boris & Jahn, Elke J., 2012. "Is There Monopsonistic Discrimination against Immigrants? First Evidence from Linked Employer-Employee Data," IZA Discussion Papers 6472, Institute of Labor Economics (IZA).
    2. Glitz, Albrecht & Wissmann, Daniel, 2021. "Skill Premiums and the Supply of Young Workers in Germany," Labour Economics, Elsevier, vol. 72(C).
    3. Riphahn, Regina T. & Sauer, Irakli, 2024. "Earnings Assimilation of Post-reunification East German Migrants in West Germany," IZA Discussion Papers 17148, Institute of Labor Economics (IZA).
    4. Chen, Shuo & Xie, Bin, 2020. "Institutional Discrimination and Assimilation: Evidence from the Chinese Exclusion Act of 1882," IZA Discussion Papers 13647, Institute of Labor Economics (IZA).
    5. Dafeng Xu & Yuxin Zhang, 2022. "Identifying ethnic occupational segregation," Journal of Population Economics, Springer;European Society for Population Economics, vol. 35(3), pages 1261-1296, July.
    6. Rocío Calvo & Felix Cheung, 2018. "Does Money Buy Immigrant Happiness?," Journal of Happiness Studies, Springer, vol. 19(6), pages 1657-1672, August.
    7. Nadiya UKRAYINCHUK & Carine DRAPIER, 2021. "Exhausted migrant effect : La santé des travailleurs immigrés en France," Region et Developpement, Region et Developpement, LEAD, Universite du Sud - Toulon Var, vol. 53, pages 69-100.

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    More about this item

    Keywords

    Migration; Labor market assimilation; Ethnic Germans; Transferability of human capital;
    All these keywords.

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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