Cultural differences and immigrants' wages

Morgan Raux

DEM Discussion Paper Series from Department of Economics at the University of Luxembourg

Abstract: In this paper, I investigate how cultural differences affect the labor-market performance of immigrant workers in Germany. I document a negative relationship between hourly wages and the cultural distance between immigrants' countries of origin and Germany. This result is robust across the three main indicators used in the gravity literature: linguistic, religious, and genetic distances. This cultural wage penalty disappears after five to ten years spent in Germany. Controlling for language proficiency as well as for selective in- and out-migration, these results highlight the cultural integration of immigrant workers. I finally provide evidence suggesting that lower wage progression may be explained by fewer job-to-job transitions.

Keywords: Cultural distance; Immigrant Workers. (search for similar items in EconPapers)
JEL-codes: J61 Z10 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-eur, nep-lab, nep-mig and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:luc:wpaper:21-02

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