Immigrant‐Native Wage Differentials and Immigration Reform

Abstract

The US Immigration Reform and Control Act of 1986 (IRCA) increased the monitoring of illegal employment and fined employers who hire undocumented immigrants. Since these provisions tax immigrant wages, it might be expected that the immigrant-native wage gap would increase after IRCA. This hypothesis is explored by decomposing immigrant-native wage differentials before and after IRCA. It is found that (i) the immigrant-native wage gap increased; (ii) in each year most of this gap was due to individual and job characteristics; (iii) the change in the gap is due primarily to overvaluation of native characteristics and to a lesser extent to undervaluation of immigrant characteristics.

Panel estimates of the earnings gap in Norway: do female immigrants experience a double earnings penalty?

“…See e.g., Neumark (1988). 16 The discrepancy in the estimates derived from the Oaxaca decomposition estimators has been found in several studies (see, e.g., Chiplin, 1981;Farber and Green, 1982;Jones, 1983;Reimers, 1983;Bucci and Tenorio, 1997 Kee (1995) used a similar approach in his cross-section analysis of wage discrimination against immigrant men in the Netherlands, and found that discrimination against immigrants (with the exception of Moroccan immigrants) was entirely due to undervaluation of their skills. The results show that the magnitude of undervaluation of average immigrant characteristics is almost twice as large as the overvaluation of average Norwegian characteristics.…”

The Effect of Naturalization on Wage Growth: A Panel Study of Young Male Immigrants

“…Many states also require citizenship for jobs involving public safety, including that of police officer. In addition, some employers may prefer to hire naturalized citizens over nonnaturalized immigrants because of discrimination by employers, employees, customers, or unions (Becker 1971) or because a U.S. passport (available only to U.S. citizens) reduces the likelihood of employer sanctions resulting from employing an illegal immigrant (Bucci and Tenorio 1997). Citizens may also be preferred because of the greater ease with which those who have a U.S. passport may travel abroad.…”

Immigration Amnesty and Immigrant's Earnings

“…Unfortunately, even now, almost twenty years after the legislation was signed into law, we still have relatively few studies on the economic consequences of immigration amnesties (Chiswick (1988), Barreto, Ramirez and Woods (2005), Gonzalez-Baker (1997), Cobb-Clark (2000, 2002), Massey (1987), Phillips and Massey (1999), Orrenius and Zavodny (2003), Rivera-Batiz (1999), Bucci and Tenorio (1997), Chiquiar andHanson (2002), Chiswick andMiller (1999), Nelson and Xu (2001)). This is not for lack of interest; rather there are a limited number of data sets available for proper study of these issues.…”