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Methodological Implications of a Human Capital Investment Perspective

In: Human Capital Investment

Author

Listed:
  • Harriet Duleep

    (William & Mary)

  • Mark C. Regets

    (National Foundation for American Policy)

  • Seth Sanders

    (Cornell University)

  • Phanindra V. Wunnava

    (Middlebury College)

Abstract

The IHCI model suggests that two widely accepted practices when modeling immigrant earnings growth are incorrect. First, the IHCI model suggests that earnings growth rates will vary by the level of initial earnings. Most studies allow entry earnings to vary across time or countries of origin but constrain the earnings growth rate to be the same across year-of-entry cohorts for given groups. Second, individuals not working, in school or self-employed are typically excluded from analysis. The IHCI suggests that these choices upon arrival are an important part of the dynamic path of earnings for immigrants. Omitting these immigrants omits those who are pursuing job search and learning, instead of earning. Excluding such individuals likely understates immigrant earnings growth, particularly for groups with low initial skill transferability.

Suggested Citation

  • Harriet Duleep & Mark C. Regets & Seth Sanders & Phanindra V. Wunnava, 2020. "Methodological Implications of a Human Capital Investment Perspective," Springer Books, in: Human Capital Investment, chapter 0, pages 45-52, Springer.
    • Handle: RePEc:spr:sprchp:978-3-030-47083-8_5
    DOI: 10.1007/978-3-030-47083-8_5
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