Free versus regulated migration: Comparing the wages of the New Zealand-born,other migrants and the Australia-born workers in Australia

New Zealanders can cross borders freely, work and live in Australia indefinitely thanks to the Trans-Tasman Travel Agreement. This paper uses a recently developed decomposition method to decompose the weekly wage gap at various quantiles on the wage distribution between New Zealand-born (NZ-born) and Australian-born workers, and between NZ-born workers, migrants from other English speaking countries (OESC), and from non-English speaking countries (NESC) to determine how free and regulated migration influences migrants’ performance in the Australian labour market. We found that NZ-born workers earned higher weekly wages than both Australian-born and NESC workers but earned lower wages than OESC migrants. Differences in endowment were primarily responsible for the wage gaps between NZ-born and Australian-born workers and between NZ-born and OESC migrants. However, differences in returns to worker and job characteristics are mainly responsible for the wage gap between NZ-born and NESC migrants.     

Labour Market Outcomes and Skill Acquisition of High-School Dropouts

We estimate the effect that dropping out of high school has on 8 outcomes pertaining to wages, employment and subsequent skill acquisition for youths. Our analysis is based on the older cohort of the Youth in Transition Survey (YITS) for 2003, an ideal data set because it contains a rich array of outcome measures and characteristics on individuals when they are in high school and a few years later. Our analysis indicates that dropouts have poorer wage and employment outcomes, and they do not make up for their lack of education through additional skill acquisition and training. The analysis thereby suggests that policies to curb dropping out could have both desirable efficiency effects (high returns) as well as distributional effects (high returns to otherwise more disadvantaged groups) and potential social spillover effects.     

The Effect of Housework on Wages: A Study of Migrants and Native-Born Individuals in Germany

To increase labour market participation among migrants, an increase in female labour market participation is important, with wages being a significant incentive. In research on the gender wage gap, the consideration of housework has been a milestone. Gender differences in housework time have always been much greater among migrants than among native-born individuals. Based on data obtained from the German Socio-Economic Panel from 1995 to 2017, this study questioned whether housework affects the wages of migrant full-time workers differently than those of their native-born counterparts. To consider the possible endogeneity of housework in the wage equation, the analysis estimated, in addition to an OLS model, a hybrid model to estimate within effects. Significant negative effects of housework on wages resulted for migrant women and native-born individuals. The effects for migrant men were significantly smaller or insignificant, which could not be explained by threshold effects. The greater amount of time spent on housework by migrant women than by native-born women will in general lead to a larger wage decrease due to housework for migrant women than for native-born women. The results further showed that the observed variables explained very little of the migrants’ gender wage gap, in contrast to the gap of native-born individuals. Human capital returns, including education and work experiences, were much lower for migrant women than for native-born women, whereas differences in housework equally contributed to the explained share of the gap for both groups, indicating the greater relevance of housework for migrants’ wage gap.

     

ANTI‐POACHING AGREEMENTS IN LABOR MARKETS

We analyze competition for experienced workers among wage‐setting firms. The firms can design poaching offers with higher wages to workers who switch from rivals relative to wages paid to their own existing employees. We evaluate the profit and welfare effects of anti‐poaching agreements that eliminate poaching offers as a recruiting method. Anti‐poaching agreements increase industry profits, whereas workers are made worse off. We show that the effects of anti‐poaching agreements on total welfare are determined by the magnitude of workers' switching costs and the productivity change associated with switching employers. (JEL L41, L40, J42)     

Fixing minimum wage levels in developing countries: Common failures and remedies

Some developing countries have set their minimum wages too high or too low to constitute a meaningful constraint on employers. The article compares minimum wages worldwide, proposes several ways of measuring them in developing countries and discusses whether they are effective thresholds in those countries. The second part of the article considers the institutional factors leading countries to set minimum wages at extreme levels. The author concludes that the minimum wage is used as a policy instrument to several ends – wage negotiation, deflation and social dialogue – which results in the absence of a wage floor, weak collective bargaining, or non‐compliance.     

The relationship between employer‐provided training and the retention of older workers: Evidence from Germany

A substantial portion of Germany's workforce will soon retire, making it difficult for businesses to meet their human capital needs; training older workers may help to manage this demographic transition. The authors therefore examine the relationships between employer‐provided training programmes, wages and retirement among older workers. They find that when establishments offer special training programmes targeted at these workers, women – especially low‐paid women – are less likely to retire, possibly because of consequent wage growth. Their results suggest that such targeted training can indeed play an important role in retaining low‐wage older women and advancing their careers.     

On-the-job training and starting wages

Human capital theory predicts that training should reduce starting wages, yet this rela-tionship remains empirically undocumented. Estimation of how training affects wages must control heterogeneity bias. I do this by estimating firstdifference starting wage regressions on a sample of workers from the Employment Opportunities Pilot Project (EOPP) data. I find that on-the-job training has a statistically significant effect on starting wages.     

The effects of ability on returns to over‐ and under‐education: Evidence from Malaysia

In Malaysia, skilled‐job creation does not match the rising number of tertiary‐educated workers. The resultant accumulation of skill and ability competencies and work experience raises the question of the extent to which this enhances (mitigates) the wage premium (penalty) of over‐education (under‐education). Using data collected in Peninsular Malaysia in 2015, the authors estimate the effects of ability on returns to education. Their findings suggest that improving specific types of ability may be a means of rectifying wage deficiencies resulting from over‐ and under‐education. On this basis, human resource development in schools and in the workplace should focus on developing job‐specific workplace abilities.     

Regional Economic Performance and Net Migration Rates in Russia, 1993–20021

Soviet legacies and uneven economic distress make post‐Soviet Russia an especially interesting case in which to assess the effects of economic performance on regional net migration rates. Random effects models of net regional migration in 77 Russian regions from 1993 to 2002 indicate that mean wages and unemployment levels have substantial and predictable effects. These effects have several dynamic aspects: changes in mean wages (but not changes in unemployment) exert effects independently of wage and unemployment levels, the effect of unemployment decreases over time, and the effect of wage levels appears to increase. Overall, the results suggest a tendency toward regional equilibrium with respect to employment following the initial shock of Soviet collapse and market reforms, but continuing disequilibrium with respect to wages.     

Wage Inequality and Performance in Nonprofit and For‐Profit Organizations

This article examines the effects of several forms of wage inequality on service quality and employee effort. We suggest that two popular theories, tournament and fair wage/equity, are not necessarily competing. Each theory accurately describes aspects of employee behavior, but because of sectoral differences in organizational objectives and employee attitudes, tournament theory's predictions are relatively stronger in the for‐profit sector, while fair wage/equity theory's predictions are relatively stronger in the nonprofit sector. Using an employer–employee matched data set of nursing homes linked to a federal regulatory database and a resident survey, we found that ownership moderates the relationship between wage inequality and service quality. Although wage inequality positively affects service quality in the for‐profit sector, the reverse is true among nonprofit organizations. We also found that overall wage inequality in the workplace has a more pronounced influence on employee discretionary effort than does the employee's place in the distribution of wages.     

Inter‐country wage differences in the European Union

This article investigates the determinants of wage gaps between European Union countries along the wage distribution, applying the methodology proposed by Firpo, Fortin and Lemieux (2009) and Fortin, Lemieux and Firpo (2011). The authors conclude that both wage structure and composition effects contribute to explaining wage differentials, but that the wage structure effect is more important. This latter effect would appear to derive from differences between unknown factors, while the composition effect can largely be explained by differences in the following areas: education, proportion of workers with supervisory responsibilities, occupational structure, and, to a lesser extent, industrial structure.     

Compensation of Foreign and Domestic Nurses in the US

This study tests the union skill homogeneity hypothesis by examining whether the erosion of foreign-domestic wage differentials reported in past studies varies by union status. We argue that the common practice of unions negotiating standardized wages promotes skill homogeneity that allows high credential-low unmeasured skill foreign nurses the opportunity to receive wages that match high credential domestic nurses without foreign nurses relying heavily on their labor mobility. Findings show returns to domestic experience accrue faster for foreign nurses belonging to a union compared to returns for non-union foreign nurses. In general, findings on pension coverage indicate foreign nurses also benefit from belonging to a union, while findings on employer sponsored health care benefits indicate a lack of any notable differences in the receipt of this compensation by foreign and union status.     

Can a minimum wage increase have an adverse impact on inequality? Evidence from two Latin American economies

This paper uses a semiparametric model to analyze the impact of an increase in the real minimum wage on inequality in Colombia between 1995 and 1999 and in Paraguay between 1993 and 2000–2001. Simulations suggest that if the employment effects of the minimum wage increase are ignored, the underlying policies would contribute to reduce earnings inequality in Colombia and would be inequality neutral in Paraguay. By considering the drop in wages of those who lost their jobs, simulations suggest that in both countries the policy in question would increase earnings inequality under some assumptions about the employment elasticity of the minimum wage and the new level of earnings unemployed workers rely upon. While these findings do not mean that minimum wage increases in LDCs (Less Developed Countries) necessarily have adverse distributional affects, they suggest that minimum wage policy should be implemented with care depending on how sensitive employment is to wage increases. An erratum to this article can be found at     

Cognitive skills and Black–White wages in the United States labor market

Using data from the National Longitudinal Survey of Youth (NLSY), this study analyzes the effects of cognitive skills on the wages of Whites and African Americans in white and blue collar occupations. The results show that cognitive skills, net of education, are important predictors of wages across all occupations. Mathematics skills, in particular contribute to significant wage premiums for workers in white and blue-collar occupations, with the exception of Blacks in blue-collar professions. English skills lead to significant wage premiums only for Blacks in blue-collar occupations. While the incorporation of cognitive skills narrows the Black-White wage gap considerably, the effects of skills on the wages of Blacks and Whites are far from uniform. The results also show that despite using detailed controls for the quality of education, an extra year of schooling yields the highest wage premium for Whites in all occupations.     

The Effects of Prevailing Wage Laws: A Comparison of Individual Workers'' Wages Earned on and off Prevailing Wage Construction Projects

I evaluate the effects of prevailing wage laws using a unique data set that shows the wages paid to workers on prevailing wage projects and the wages paid to the same workers during the same time period for work on projects not covered by prevailing wage regulations. The wage comparison shows that workers are generally paid more for work on prevailing wage projects than they are for work on non-prevailing wage projects. Thus, prevailing wage laws likely do increase the cost of public construction. In addition, to the extent that the quality of construction is improved, prevailing wage laws appear to be an inefficient mechanism by which to achieve additional quality, as the regulations often result in workers being paid more than they earn in the private market.     

Penalties and payoffs: The short-term economic consequences of human capital acquisition for resettled refugees in the United States

The relationship between refugee investments in human capital and short-run economic outcomes may influence the extent to which refugees invest in human capital that is associated with positive future economic mobility. Using data from the Annual Survey of Refugees from 2016 and 2017 we assess the relationship between recent investments in human capital and hourly wages for employed refugees in the United States. Results suggest that recent job training has a positive effect on hourly wages. In contrast, enrollment in English classes and educational programmes have no short-term positive effects on hourly wages. When combined with the pressure resettled refugees experience to find employment quickly, these results suggest that the lack of short-term wage benefits from English language or educational courses may dissuade refugees from sufficiently investing in the amount of English language or education necessary to promote positive long-term economic mobility.     

Immigrant Wage Disadvantage in Sweden and the United Kingdom: Wage Structure and Barriers to Opportunity1

This article examines immigrant/native-born wage inequalities among workers in two Western European countries: Sweden, social democratic and with comparatively low wage dispersion, and the United Kingdom, economically liberal and with comparatively high wage dispersion. The analysis includes immigrants from 26 countries of origin. Findings demonstrate that inequalities in terms of real wages are smaller in more egalitarian Sweden. However, in terms of relative positions within the labor market, inequalities are if anything smaller in the UK. These findings highlight the role of wage dispersion in magnifying immigrant disadvantage, but also the limits of wage compression for ameliorating barriers to immigrant opportunity.     

On the Labour Market Progress of Polish Accession Workers in South‐East England

The enlargement of the European Union (EU) in May 2004 produced a very significant wave of immigration to the United Kingdom that is likely to continue to impact its labour market in forthcoming years. Polish migrants were by far the largest cohort of the new entrants. This paper complements previous work that has begun to establish the characteristics and labour market performance of migrants from the new member states who have entered the United Kingdom. This paper uses a unique micro‐level data base to investigate the labour market evolution of Polish migrants in the UK labour market. We find that in the first UK job returns to human capital were negligible. However, for the current job an extra year of education increases the weekly gross wage by 3.2 per cent. There is evidence of a gender differential in pay in both jobs and that older workers are paid more than their younger counterparts but this effect becomes insignificant in the current job. We find that hours worked is a significant factor in wage determination. However, the influence of hours worked on wages declined by approximately 38 per cent between the first and current job. Results from multinomial logit models suggest that over‐time there is some “match” between the occupational groupings that these workers were attached to in Poland and the United Kingdom. We also find evidence that the use of employment agencies by some of these workers increases the likelihood of employment in skilled manual and non‐manual occupations. Workers who have had supervisory responsibility in the United Kingdom are more likely to be in professional or intermediate occupations.     

Social Capital is Associated with Earnings among Foreign‐born Mexican Men but not Women in Los Angeles County

The mechanisms through which social capital is accumulated may influence its relationship with hourly earnings. Because Mexican men and women accumulate social capital differently, for instance, gender may be an important factor for understanding social capital’s association with Mexican migrant earnings. Unlike past research that often fails to differentiate between various social capital metrics (e.g., social network member reciprocity, participation in civic group organizations, neighbourhood trust), this article estimates two of these associations with wages while controlling for individual‐, household‐ and neighbourhood‐level characteristics. Results suggest that foreign‐born Mexican men receive a wage premium from civic participation (bridging social capital) and a wage penalty from reciprocal social network exchange (bonding social capital). We also find that unauthorized legal status (among Mexican men and all migrants) and having children (among women) were negatively associated with hourly wages. We conclude with a discussion of the relative association of human and social capital with Mexican migrant wages.