On the foreign to native wage differential in Germany: Does the home country matter?

Stephan Brunow and Oskar Jost
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Oskar Jost: Institute for Employment Research (IAB), Nuremberg, Germany

No 202026, IAB-Discussion Paper from Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]

Abstract: "The German labour force is expected to shrink in the next two decades due to a decline in population. Therefore, the immigration of workers from abroad could compensate potential negative effects of such decline. Is Germany competitive for immigration – i. e., do German employers pay enough to make it attractive as a destination country? We explore the wage gap between foreigners and German employees in particular and focus on different countries of origin to better understand issues related to wage setting among these groups. For this purpose, a threefold Oaxaca–Blinder decomposition is performed using a comprehensive data with a vast amount of information on a large number of workers and firms. The results suggest that most of the wage gap can be explained by observed characteristics, and in most cases, very little difference remains unexplained. We provide evidence on differences specific to the country of origin which could be taken in into consideration to attract people from abroad to better integrate them into the German labour market." (Author's abstract, IAB-Doku) ((en))

Keywords: Bundesrepublik Deutschland; ausländische Arbeitnehmer; Berufserfahrung; Determinanten; Einwanderer; Herkunftsland; Inländer; Integrierte Erwerbsbiografien; Lohnunterschied; qualifikationsspezifische Faktoren (search for similar items in EconPapers)
Pages: 26 pages
Date: 2020-08-12
New Economics Papers: this item is included in nep-eur and nep-mig
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:iab:iabdpa:202026

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