Absolute Income,Relative Income,and Happiness

This paper uses data from the World Values Survey to investigate how an individual’s self-reported happiness is related to (i) the level of her income in absolute terms, and (ii) the level of her income relative to other people in her country. The main findings are that (i) both absolute and relative income are positively and significantly correlated with happiness, (ii) quantitatively, changes in relative income have much larger effects on happiness than do changes in absolute income, and (iii) the effects on happiness of both absolute and relative income are small when compared to the effects several non-pecuniary factors.

The substitutability of labor between immigrants and natives in the Canadian labor market: circa 1995

This paper examines the substitutability or complementarity between Canadian-born and immigrant workers. These are examined by estimating a set of wage equations using a generalized Leontief production function. The paper finds that, in general, there is no displacement of Canadian-born workers by immigrants. Recent immigrants affect the native-born positively, while older immigrants are neither substitute nor complement for natives. However, the effects differ across industries. Overall, the evidence that immigrants harm the opportunities of native-born workers is scant.

Labor market transitions of immigrants with emphasis on marginalization and self-employment

In developed countries, immigrants are more likely to be nonemployed and self-employed compared to natives. Based on register data of male immigrants in Denmark, we performed a detailed investigation of the immigrant–native difference in transition patterns across labor market states. We find that a high proportion of immigrants from non-Western countries tend to be marginalized relative to natives, and they tend to use self-employment to escape marginalization.

The dynamics of immigrant welfare and labor market behavior

This paper analyzes transitions into and out of social assistance, unemployment, and employment. We estimate a dynamic multinomial logit model, controlling for endogenous initial condition and unobserved heterogeneity, using a large representative Swedish panel data set. The empirical results suggest that particularly refugee immigrants display a greater degree of “structural” state dependence than natives. The high welfare participation rates among refugee immigrants may be due to the existence of a “welfare trap”, while participation among natives and non-refugee immigrants is largely due to permanent unobserved characteristics. These results suggest that welfare reforms may have differential effects on refugee immigrants and natives.

Information and racial exclusion

We present several economic models of racial segregation and income inequality. The use of race as a signal arises from imperfect information about the return to transactions with particular agents. In a search framework, signaling supports not simply a discriminatory equilibrium, but a pattern of racially segregated transactions, which in turn perpetuates the informational asymmetries. Equilibrium income disparities depend on the relative size of the minority group and on the informational “distance” between races. Under some circumstances, minority agents will self-segregate since they face an adverse selection of majority agents who are willing to trade with them.

Too many migrants, too few services: a model of decision-making on immigration and integration with cultural distance

We model the political demand for immigrants as a trade-off that native voters face between having services, assumed to be produced only by unskilled and nonassimilated immigrants, and experiencing disutility due to the immigrant workers having a culture different from the native culture. Immigrants decide whether to integrate into the native culture. We show that if services are priced according to per unit costs, the market demand for immigrants will exceed the political demand. Market forces then lead to higher services prices, implying that the initially allowed number of immigrants is ‘politically’ too large.

Nonmarket networks among migrants: evidence from metropolitan Bangkok,Thailand

This paper examines the nonmarket interactions among migrants in the urban labor market of Bangkok, Thailand. We test whether the population size and the labor-market performance of previous migrants have externalities to new migrants who have moved from the same province of origin. Our empirical results, which control origin fixed effects, time fixed effects, and origin- and year-specific correlated shocks, show that (1) the relative population size of previous migrants in the market decreases the employment probability of new migrants (substitution effect), (2) the employment probability of previous migrants increases that of new migrants (positive externalities), and (3) when the employment probability of previous migrants is high, however, the scale effect becomes positive, which demonstrates a threshold in the informational scale economies. The results imply that positive informational scale effect dominates negative substitution effect when the efficiency of previous migrants is sufficiently high in the destination labor market.

Housing Adjustment Among Immigrants in Israel: Application of Complementary Non-Metric and Metric Techniques

This study applies two different complementary statistical techniques to examine the structure and determinants of homeownership and consumption of household goods among immigrants in Israel. Findings from partial-order analysis (POSAC) reveal significant differences between immigrant groups by type, rather than level, of household characteristics. Suppliers of entertainment (television) and of information-communication (computer) are the items that most strongly distinguish between immigrants. The joint direction of the partially ordered space corresponds with home and car ownership. Immigrant groups are dispersed in different parts of the household typology; with increased duration of residence in Israel immigrants move, albeit in varied rhythms, toward improved housing conditions. A complementary logistic regression analysis, which controls for socio-demographic variation and detailed tenure in Israel, show a likelihood of convergence of immigrants from all origin countries with the core native-born group in owning a home. For other household goods, the findings largely coincide with the typology derived from POSAC. The findings are discussed in reference to three conceptual expectations of “cultural norms”, “adjustment”, and “structural-environmental considerations”.

Human Well Being: A Decile Group Analysis on Indian Household Data

This is an attempt to measure human well being across different sections of the society in India over time where sections have been made in terms of ten decile groups of income. In this context, the extent to which rural sector is lagging behind the urban sector is another dimension of the study. The study uses grouped household data, collected and made available by National Sample Survey Organisation between 1987–1988 and 1999–2000. The inter decile group analysis does not show parity in the attainment levels of the individual indicators of human well being, although an overall systematic inter temporal betterment for each decile group is very clear. Rural–urban gaps in terms of attainment of these indicators is also not so small.

Understanding changes in Māori incomes and income inequality 1997–2003

This paper examines recent changes in weekly income levels and dispersion for Māori, New Zealand’s indigenous ethnic group. Changes in the Māori income distribution between 1997 and 2003 reflect rapid increases in economic growth and employment rate. A reduced proportion of people had zero or benefit-level incomes and a higher proportion had high incomes. Income inequality declined for working-aged Māori and was stable for employed Māori. The average income gap between Māori and Europeans declined. The increased Māori employment rate during this period was the single most important driver of changes in the Māori income distribution.

Transportation and Migrant Adjustment in Georgia

Access to transportation is critical for functioning in modern American society, and minorities disproportionately lack access to transportation. Latinos in Georgia—most of whom are newcomers to this country—are considerably less likely than non-Latino whites to drive alone to and from work because they do not live in households with a car available for personal use. We propose that this factor, along with limited access to alternative modes of transportation, impedes the ability of Georgia’s newest Latino residents to adjust to their new environment. In this study, we examine the impact of limited transportation options on the adjustment experience of recent Latino migrants to Georgia. We document how lack of personal transportation lends itself to a number of social problems including inability to obtain different work or to take advantage of opportunities for advancement. For Latinos who are both recent migrants to Georgia and recent immigrants to the United States, lack of transportation creates an adjustment “bottleneck,” whereby various paths to adaptation are simultaneously impeded. We argue that improving access to driver’s licenses, pedestrian infrastructure, and, in some places, public transportation should be a policy priority for states adjusting to recent influxes of Latino migrants.

Personality traits and gender-specific income expectations in Dutch higher education

In this article we examine gender differences in income expectations of students in higher education. We found quite large gender differences. Men and women differ significantly in the income they expect to earn at the top of their career. We examined how much personality traits contribute to explain gender differences in income expectations, and to what extent personality typologies can add to insights about earnings potential derived from human capital theory. The research shows that personality does affect expected income, that impact goes beyond personality’s indirect effects, which are conveyed largely through gender differences and students’ choice of study subject.

Determinants of recent immigrants’ location choices: quasi-experimental evidence

This paper exploits a Danish spatial dispersal policy on refugees, which can be regarded as a natural experiment to investigate the influence of regional factors on recent immigrants’ location choices. The main push factors are lack of co-nationals and immigrants. Additional push factors are lack of rental, including social, housing and lack of institutions for qualifying education, which explain why recent immigrants are attracted to large cities. Finally, placed refugees tend to leave locations with relatively high regional unemployment, and there is indirect evidence of welfare seeking.

Money Does not Buy Happiness: Or Does It? A Reassessment Based on the Combined Effects of Wealth,Income and Consumption

The paper uses household economic panel data from five countries—Australia, Britain, Germany, Hungary and The Netherlands—to provide a reassessment of the impact of economic well-being on happiness. The main conclusion is that happiness is considerably more affected by economic circumstances than previously believed. In all five countries wealth affects life satisfaction more than income. In the countries for which consumption data are available (Britain and Hungary), non-durable consumption expenditures also prove at least as important to happiness as income.

Enclaves, language, and the location choice of migrants

Empirical studies in the migration literature have shown that enclaves (networks) negatively affect the language proficiency of migrants. Most of these studies do not address the choice of location as a function of language skills. Using data on Mexican migration to the US, we show that migrants choose smaller networks as their English language proficiency improves.

Growing old and staying young: population policy in an ageing closed economy

This paper analyses the relation between public pensions, fertility and child care in a closed-economy overlapping generations model with endogenous fertility. It is shown that raising a child involves two social externalities and that it is optimal to introduce child allowances if the government redistributes income from the young to the old. The optimal child allowance rises when longevity increases. If the costs of raising children depend positively on the wage, a third externality arises and the returns to savings should be taxed.

Ability and rates of return to schooling—making use of the Swedish enlistment battery test

Using the Swedish military enlistment test, this paper estimates the return to schooling for individuals belonging to different parts of the ability distribution. It also attempts to predict whether an endogenous test score causes bias in the “ability-specific” returns to schooling that varies with the test score. A significant finding is that a higher score in the test is associated with a higher return to schooling, but that the positive association is diminishing in the test score. In general, the bias in the ability-specific returns to schooling does not seem to vary with the test score level.

Extremism within the family

This paper considers an economic analysis of intergenerational transition of ethnic and social trait. We consider the level of social traits chosen by parents and its effect on their children’s choice of ethnic and social traits when reaching adulthood. We develop a theory that suggests that parents will chose extreme ethnic and social traits to increase the cost that their children will pay if they wish to deviate from their parents’ “ideal.” The extreme choice of the ethnic social traits of parents has an effect on the segregation of minorities and migrants.

Assimilation effects on poverty among immigrants in Norway

This paper discusses the question of whether or not the high incidence of poverty among immigrants in Norway persists even after immigrants have been in the country for a long period, i.e. after they have had the opportunity to integrate and adapt their skills to the expectations in their new home. While similar to traditional studies of wage assimilation, a study of assimilation in relation to poverty propensity nevertheless measures something different than labor market assimilation, and this represents the main innovation of this study. Analysis of assimilation with respect to poverty focuses on welfare for the lower end of the income distribution and for all individuals, regardless of their relationship with the labor market. It can therefore be seen to better reflect the degree to which immigrants as a whole are able to achieve at least the minimum necessary to participate in the life of their new home and avoid difficulties later on.