Employer Policies and the Immigrant-Native Earnings Gap

Benoit Dostie, Jiang Li, David Card and Daniel Parent ()

No 27096, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We use longitudinal data from the income tax system to study the impacts of firms’ employment and wage-setting policies on the level and change in immigrant-native wage differences in Canada. We focus on immigrants who arrived in the early 2000s, distinguishing between those with and without a college degree from two broad groups of countries – the U.S., the U.K. and Northern Europe, and the rest of the world. Consistent with a growing literature based on the two-way fixed effects model of Abowd, Kramarz, and Margolis (1999), we find that firm-specific wage premiums explain a significant share of earnings inequality in Canada and contribute to the average earnings gap between immigrants and natives. In the decade after receiving permanent status, earnings of immigrants rise relative to those of natives. Compositional effects due to selective outmigration and changing participation play no role in this gain. About one-sixth is attributable to movements up the job ladder to employers that offer higher pay premiums for all groups, with particularly large gains for immigrants from the “rest of the world” countries.

JEL-codes: J15 J31 J62 (search for similar items in EconPapers)
Date: 2020-05
New Economics Papers: this item is included in nep-lab, nep-ltv, nep-mig and nep-ure
Note: LS
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

Published as Benoit Dostie & Jiang Li & David Card & Daniel Parent, 2021. "Employer policies and the immigrant–native earnings gap," Journal of Econometrics, .

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Related works:
Journal Article: Employer policies and the immigrant–native earnings gap (2023)
Working Paper: Employer Policies and the Immigrant-Native Earnings Gap (2020)
Working Paper: Employer Policies and the Immigrant-Native Earnings Gap (2020)
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