Self?Selection of Emigrants: Theory and Evidence on Stochastic Dominance in Observable and Unobservable Characteristics

George Borjas, Ilpo Kauppinen and Panu Poutvaara

No 9434, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We show that the Roy model has more precise predictions about the self-selection of migrants than previously realized. The same conditions that have been shown to result in positive or negative selection in terms of expected earnings also imply a stochastic dominance relationship between the earnings distributions of migrants and non-migrants. We use the Danish full population administrative data to test the predictions. We find strong evidence of positive self-selection of emigrants in terms of pre-emigration earnings: the income distribution for the migrants almost stochastically dominates the distribution for the non-migrants. This result is not driven by immigration policies in destination countries. Decomposing the self-selection in total earnings into self-selection in observable characteristics and self-selection in unobservable characteristics reveals that unobserved abilities play the dominant role.

Keywords: international migration; Roy model; self-selection (search for similar items in EconPapers)
JEL-codes: F22 J61 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2015-10
New Economics Papers: this item is included in nep-lab and nep-mig
References: Add references at CitEc
Citations: View citations in EconPapers (15)

Published - published in: Economic Journal, 2019, 129, 143–171

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https://docs.iza.org/dp9434.pdf (application/pdf)

Related works:
Journal Article: Self-selection of Emigrants: Theory and Evidence on Stochastic Dominance in Observable and Unobservable Characteristics (2019)
Working Paper: SELF-SELECTION OF EMIGRANTS: THEORY AND EVIDENCE ON STOCHASTIC DOMINANCE IN OBSERVABLE AND UNOBSERVABLE CHARACTERISTICS (2019)
Working Paper: Self-Selection of Emigrants: Theory and Evidence on Stochastic Dominance in Observable and Unobservable Characteristics (2016)
Working Paper: Self-Selection of Emigrants: Theory and Evidence on Stochastic Dominance in Observable and Unobservable Characteristics (2015)
Working Paper: Self-Selection of Emigrants: Theory and Evidence on Stochastic Dominance in Observable and Unobservable Characteristics (2015)
Working Paper: Self-Selection of Emigrants: Theory and Evidence on Stochastic Dominance in Observable and Unobservable Characteristics (2015)
Working Paper: Self-Selection of Emigrants: Theory and Evidence on Stochastic Dominance in Observable and Unobservable Characteristics (2015)
Working Paper: Self-Selection of Emigrants: Theory and Evidence on Stochastic Dominance in Observable and Unobservable Characteristics (2015)
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