Local Unemployment and the Earnings Assimilation of Immigrants in Norway
Year: 2002
Type: preprint
Study design: Observational Study
Abstract: Labour market outcomes of immigrants and natives are affected differently by macroeconomic conditions. In particular, we show that earnings of immigrants in Norway from outside the OECD area are more sensitive to local labour market conditions than are earnings of natives. Failure to account for such differences may bias estimates when periods of rising or declining unemployment are important to identify assimilation effects on immigrant earnings. We show that this is the case for Norway: An observed drop in relative earnings of non-OECD immigrants after about 10 years in the host country disappears when we account for differential business cycle effects on immigrant and native earnings. The empirical evidence also reveals that local labour market conditions impact the rate of the earnings assimilation. We interpret the effect of unemployment on the assimilation rate in terms of a combined "wage curve effect” and a “learning effect” on the rate at which immigrants acquire country-specific human capital.
Authors: Erling Barth, Bernt Bratsberg, Oddbjørn Raaum
Language: English
Topic: Migration and Labor Dynamics
Subfield: Sociology and Political Science
Field: Social Sciences
Domain: Social Sciences
Open Access status: green
Funder: Norges Forskningsråd
OpenAlex ID: W2118420381