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Earnings Assimilation of Post-reunification East German Migrants in West Germany

Author

Listed:
  • Riphahn, Regina T.

    (University of Erlangen-Nuremberg)

  • Sauer, Irakli

    (University of Erlangen-Nuremberg)

Abstract

We investigate the wage assimilation of East Germans who migrated to West Germany after reunification (1990-1999). We compare their wage assimilation to that of ethnic German immigrants from Eastern Bloc countries and international immigrants to West Germany who arrived at the same time. The analysis uses administrative as well as survey data. The results suggest that East Germans faced significant initial earnings disadvantages in West Germany, even conditional on age and education. However, these disadvantages were smaller than those of international immigrants, supporting the beneficial role of cultural similarity. The earnings gap relative to West German natives narrowed over time for all immigrants. These findings are robust to controlling for potentially endogenous return migration and labor force participation. Controls for fixed effects reveal that positive assimilation for East German and international immigrants was concentrated among highly educated immigrants.

Suggested Citation

  • 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).
    • Handle: RePEc:iza:izadps:dp17148
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    Keywords

    cultural similarity; labor market integration; internal migration; earnings assimilation; migration; Germany; reunification;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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