Foreign migrants versus internal migrants: the assimilation pattern (original) (raw)
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Wage assimilation: migrants versus natives and foreign migrants versus internal migrants
Rscas Working Papers, 2013
The paper wants to understand the assimilation pattern of foreign migrants in Italy. Three novelties characterize this study. First, the research compares the wage assimilation of international migrants with both internal migrants and local natives in Italy, a country with substantial internal and international migration. This comparison, never exploited before, provides indirect evidence for the role played by language and knowledge of social capital in the assimilation of foreign migrants relative to both natives and internal migrants. Second, we inquired into the possible causes of underassimilation by controlling for the date of entry and migrant sector concentration. Third, we model new corrections of the selection bias due to return migration. The correction for the selection bias is introduced in the wage equation through a duration extension of the traditional Heckman correction term and alternatively through a hazard rate correction. The empirical test uses the Italian administrative dataset on dependent employment (WHIP), to estimate a fixed effect model for the weekly wages of males aged 18-45 with controls for selection in return migration and unobserved heterogeneity. The three groups of workers start their careers at the same wage level. But, as experience increases, the wage profiles of foreign nationals and natives, both internal migrants and locals, diverges which seems to hint at the importance of language and social capital. However, sectorby-sector analysis shows that in "migrant intense sectors" internal migrants and locals have the same wage profile as foreign workers. Positive selection in returns reinforces the view that the best leave because they have few career options. Thus under assimilation is caused more by community and job segregation than by a lack of language and social capital: alternatively it is the result of their interrelations.
Wage assimilation: migrants versus natives
2013
BACKGROUND Italy is a country of recent foreign immigration with a long history of internal migration. Concerns about economic integration addressed in the past flows of southern natives to the north and now the international migrants, who are crucial in an ageing society. OBJECTIVE This paper studies the assimilation pattern of foreign migrants in Italy by comparing wage profiles for foreign nationals with both locals and internal migrants. Possible causes of under-assimilation are analysed by controlling for macro economic conditions at entrance into the labour market and for labour market segmentation. METHODS WHIP data are used to estimate a fixed effect model for the weekly wages of males aged 18-45. Controls for selection for return migration are introduced through a duration extension of the traditional Heckman correction term and alternatively through a hazard rate correction. RESULTS The three groups of workers start their careers at the same wage level. But, as experience increases, the wage profiles of foreigners and the two groups of natives diverge. The analysis shows that the concentration of foreign nationals in "migrant intense sectors" is the primary reason for lack of assimilation. We also find positive selection in returns for foreign workers: the more skilled are more likely to leave Italy because of the lack of opportunities in terms of career upgrading. CONCLUSIONS Under assimilation of foreign workers in the Italian labour market is essentially caused more by job segregation than by a lack of language knowledge and social capital endowment or by the macro economic conditions faced at entrance into the labour market.
Are Foreign Migrants More Assimilated Than Native Ones
2009
The paper compares the pattern of wage assimilation of foreigners with both native immigrants and local natives in Italy, a country with large internal and international migration. This comparison, not yet exploited, yields understanding of the role played by language and knowledge of social capital. We use the administrative dataset on dependent employment (WHIP), to estimate a fixed effect model of the weekly wages of males aged 18-45 with controls for selection in return migration and unobserved heterogeneity. The three groups of workers start their careers at the same wage level but, as experience increases, the wage profiles of foreigners and natives, both immigrants and locals, diverge. A positive selection in the returns prevails, so that the foreign workers with lower wages are the most likely to stay in Italy. Also an "ethnic" skill differential emerges and a negative status dependence for those entering at low wage level.
Labour-market assimilation of foreign workers in Italy
Oxford Review of Economic Policy, 2008
This is the first paper that analyses the labour market assimilation of foreign (i.e. non-citizen) workers in Italy. It considers the daily wages and the days of employment of male workers in WHIP, a matched employer-employee panel dataset, from 1990-2003. The traditional human capital approach is augmented by a control for the probability of staying abroad, modelled by aggregate variables of the origin country. The human capital variables considered are age and experience, both in and out of employment. What emerges from the empirical analysis is discouraging. Foreigners who are able to get higher wages are the least likely to stay, but assimilation profiles do not change when return migration is taken into account. Foreigners employed in the private sector earn the same wages as natives upon entrance into employment, but the two wage profiles diverge with on-the-job experience. Neither do foreigners assimilate from an employment perspective: a differential in employment between foreign and native workers is found even upon entrance, which increases over time.
Does Immigration Raise Blue and White Collar Wages of Natives? The Case of Italy
LABOUR, 2010
This paper analyses theoretically and empirically the effects of immigration on the wage rate of native workers. Empirical literature rarely finds that immigration generates a fall in the wages of manual workers. The theoretical model presented in this paper justifies those results, by hypothesizing an economic system where advanced firms buy an intermediate good from traditional firms, which employ manual workers in both clean and dirty tasks, the latter being more disliked by native workers. We conclude that native skilled wages always increase whereas native unskilled wages can both increase or decrease with immigration. An empirical analysis of the Italian labour market follows, showing that all native workers' wages rise with immigration JEL Class.: J31; J61; J82.
Working Papers Labour Market Effects of Immigration: an Empirical Analysis Based on Italian Data
Gavosto, Venturini, Villosio (1999) found that the impact of immigrants on the wage rates of natives was positive. This result has led to the present paper which analyses the effect of immigrants on native employment. Two aspects of being unemployed are considered: i) displacement risk, the probability of moving from employment into unemployment; and ii) job-search effectiveness, the probability of moving from unemployment into employment within one year. The quarterly Labour Force Survey data (ISTAT) from 1993 to 1997 are used. The transition probabilities depend on two sets of independent variables at time t: the individual’s characteristics and the external conditions of the market. A probit model is applied for repeated-cross-sections on “specific” local areas in order to check for possible autocorrelation and endogeneity. The results show that in the North of Italy, where most immigrants are located, the share of immigrants has either no effect or has a complementary effect on the probability of finding a job in the case of workers looking for a new job; while in the case of people looking for a first job (young people) the effect was negative in 1993; while it was positive in the last years. A complementary effect prevails in the case of native transition from employment to unemployment. There is a negative effect only in the manufacturing sector in Northern Italy for 1996, and this is probably due to other factors, such as the increased use of temporary contracts in that area during that year.
QUADERNI DI ECONOMIA DEL LAVORO
This paper aims at investigating the phenomenon of graduates' migration from an OECD country at a microeconomic level to offer insight into the scholarly debate on migration decisions of high-skilled workers living in a developed country. By merging data on employment conditions of Italian graduates with the results of an ad-hoc survey on Italian graduates working abroad, the paper assesses the selectivity of migration choices, the wage premium associated with migration decision on their earnings, and the determinants of the earning function for those graduates that work abroad. Results suggest a high complexity of both the selection and the earning function of high-skilled migrants coming from a developed country.
Economic Modelling, 2011
This paper examines the impact of the immigration of foreigners on domestic labor mobility. Since David Card's seminal study on the regional labor market impact of the Mariel Boatlift it is controversial whether domestic labor mobility equilibrates economic conditions across regions. However, there is little or no evidence that natives leave destinations where migrants tend to cluster. In this paper we reconcile the existing evidence by taking another route: we analyze whether the immigration of foreigners replaces domestic mobility from poor to rich regions. We focus on Italy, which is characterized by large North-South wage and unemployment differentials, and apply panel cointegration methods. The main finding is that, conditional on unemployment and wage differentials, the presence of foreign workers in the labor force of the destination regions discourages internal labor mobility significantly. As a consequence, spatial correlation studies which use the variance of the foreigner share across regions for identifying the wage and employment effects of immigration, tend to understate the actual impact of foreign immigration.