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Language Usage, Participation, Employment and Earnings: Evidence for Foreigners in West Germany with Multiple Sources of Selection

Stephan Thomsen (), Johannes Gernandt () and Alisher Aldashev ()

No 08-090, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: Language proficiency may not only affect the earnings of the individual, but the probability to participate in the labor market or becoming employed as well. It may also affect selection of people into economic sector and occupation. In this paper, the effects of language proficiency on earnings are analyzed for foreigners in Germany with joint consideration of up to four types of selection. The results show that language proficiency significantly increases participation and employment probability and affects occupational choice. When selection into economic sector and occupation is regarded, we do not find an impact of language ability on earnings thereby implying an indirect effect.

Keywords: Foreigners; Participation; Employment; Language Ability; Multiple Selection (search for similar items in EconPapers)
JEL-codes: J61 J24 J15 C35 (search for similar items in EconPapers)
Date: 2008
New Economics Papers: this item is included in nep-lab
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