Does better pre-migration performance accelerate immigrants' wage assimilation?

Elke Jahn, Boris Hirsch, Ott Toomet and Daniela Hochfellner

VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order from Verein für Socialpolitik / German Economic Association

Abstract: This paper analyzes wage assimilation of ethnic German immigrants to Germany. We use unique administrative data that include a standardized measure of immigrants' pre-migration wage based on occupation, industry, tenure, qualification, and the German wage structure. We find that immigrants experience a substantial initial wage disadvantage compared to natives. During their first 15 years in the host country they manage to close a considerable part of this gap, though assimilation is only partial. A 10% higher pre-migration wage translates into a 1.6% higher wage in Germany when also controlling for educational attainment, thus pointing at partial transferability of human capital acquired in the source country to the host country's labor market. We also find that wage assimilation is significantly accelerated for immigrants with a higher pre-migration wage. Our results are in line with strong complementarities between general skills and host country-specific human capital, in particular proficiency in the host country's language.

JEL-codes: J24 J31 J61 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-mig
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Citations: View citations in EconPapers (1)

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Working Paper: Does Better Pre-Migration Performance Accelerate Immigrants' Wage Assimilation? (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc13:79833

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