Country context, race and wages: A comparative analysis of Ethiopian immigrant labour market integration in the United States and Israel

Abstract

American immigration policy debates focus on immigrants' (lack of) labour market success. While research shows that Black African immigrants experience the largest wage disadvantage, studies rarely discuss whether country‐context—formed by immigration policy and migration history—matters for their wages and whether race matters differently across place. We use Israeli and US data to determine whether Ethiopian immigrants are most disadvantaged across country contexts. Our results indicate that Ethiopian immigrants' credentials are higher in the United States, but that does not lead to higher relative wages than in Israel. Because we find that Ethiopian immigrants who are most similar to the native‐born earn nearly identical wages to the most marginalized groups in both countries, it is clear that country context plays only a small role in wage disparities. Instead, discrimination and unobserved differences between groups are most important.