In many migration studies that attempt to measure the monetary returns to migration, the following equation is estimated with microdata:ln w = Σ β X + α E + α E2 + α M + α M •T + α M •T2 + e

k i = 1 ik ik 1 k 2 k 3 k 4 k 5 k

n

Where

W = hourly wageX = vector of individual characteristicsE = Labor market experienceM = dummy variable (0,1) indication individuals who migratedT = years since migration

The key coefficients are α3 and α4. If migrants assimilate, then their wage rates will grow more rapidly over time than the nonmigrants (α4 > 0) (a period of catch-up). If the effect decreases over time as the migrants gain experience in the destination and become more like those already there, α5 < 0 (convergence slows over time).If α3 < 0 ⇒ migrants start out earning this much less than nonmigrants.

Some possible outcome measure of immigrant assimilation:1. Earnings2. Participation in public assistance programs3. Internal migration propensities4. English language acquisition5. Educational attainment6. Political participation7. Fertility8. Intermarriage9. Residential crowding

Immigrant Assimilation in the U.S. EconomyBasic proposition: through a combination of formal schooling and on-the-job training, accumulated job-related skills are modified for better adaption to the new occupational environment, and new skills specific to the U.S. jobs are acquired.

Implication: immigrants’ productivity and earnings rise with time in the U.S. After a period of time immigrant earnings may equal and even surpass those of otherwise comparable native-born persons. Moreover, those native-born persons with whom the immigrants initially competed are not the same as those with whom they ultimately compete.

Factors that ease transferability skills:1.English language2.Similar occupational structures3.Higher educational achievement

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.10. Migration decision itself- refugees less likely to be economic migrants & thus less likely to have planned and prepared for the move.- refugees are more likely to adjust quickly once they are here because return migration is difficult.- likelihood of return migration- self-selection

Potential problems with the approach:1.Comparability of foreign and domestic education2.Data not always precise about where the education was gained, here or abroad.3.Mixed empirical results4. Gaining fluency in English may reflect number of years in U.S., but English fluency is a key determinant of assimilation. For example, English results in a wage premium of almost 25% for immigrants from some Spanish-speaking countries.5.Greater numbers of people who speak the immigrant’s native tongue in the area of residence reduce the English penalty.6. Ethnic enclave effect7. Cross-sectional evidence may reflect unmeasured differences in immigrant cohorts rather than the effects of labor market experience8. Economic conditions at time of entry9. Average quality of successive cohorts has changed over time

10. 1965 changes in U.S. Immigration law.