The literature on returns to immigrants has paid little attention to female immigrants despite continuous increases in female labor force participation and its peculiarities.
Using the 2011 National Households Survey of Canada, this paper investigates the effect of language proficiency on returns to female immigrant groups in Canada and the effect across wage distributions.
Our results show that returns to female immigrant groups increase with the level of language proficiency and that language penalizes immigrants at higher quantiles of wage distribution more. Also, we find that OLS estimates are biased and inconsistent where sample selection problems exist.
Table of Contents
1. Introduction
2. Data
3. The Models
4. Results
5. Conclusion
Research Objectives & Key Topics
This paper investigates the impact of language proficiency on the earnings of female immigrant groups in Canada, utilizing the 2011 National Household Survey to analyze how these effects vary across different segments of the wage distribution while accounting for potential sample selection bias.
- Language proficiency as a determinant of immigrant labor market performance
- Heterogeneity of female immigrant groups based on source country linguistic proximity
- Application of Heckman's two-step sample selection correction procedure
- Quantile regression analysis to examine wage distribution trends
- Labor supply modeling and the economic integration of female immigrants
Excerpt from the Book
1. Introduction
The deterioration in entry earnings among recent Canadian immigrant cohorts has attracted the attention of researchers and policymakers alike (see Aydemir and Skuterud, 2005; Boudarbat and Lemieux, 2010; Green and Worswick, 2012; Skuterud, 2011 for example). Apart from affecting its reputation as a reference for successful immigrants’ assimilation policies in the world, declining immigrants’ earnings may mar Canada’s objective of competitively attracting productive immigrants to help fill its labour demand gap and engender growth. Among other factors, inadequate or low language proficiency has been identified as a major contributor to the decline in immigrants’ earnings (see Skuterud, 2011 for a review). Low language proficiency leads to job-skills mismatch and limits immigrant workers productivity (Chiswick and Miller, 2003, Imai et al., 2011).
However, most extant literature on language proficiency and returns to immigrants focus on only male immigrants (see for example Berman et al, 2003; Chiswick and Miller, 2003, 2007; Budria and Swedberg, 2015; Adsera and Ferrer, 2015). A few others consider female immigrants but they do not model their returns appropriately (see for example Miranda and Zhu, 2013; Yao and Van Ours, 2015). Arguably, the results from these studies may not be applicable to female immigrants. It is well documented in labor economics literature that female labor supply decisions differ significantly from those of males. More so, apart from the fact that female immigrants account for almost half of all Canadian immigrants, female labor force participation across all age groups in Canada has been increasing since the 1970s (Emery and Ferrer, 2009). This implies that it is important to pay attention to the earnings of female immigrants, and to model the determinants of their earnings properly. This is the motivation for this paper: we examine the effect of language proficiency on returns to female immigrants in Canada.
Summary of Chapters
1. Introduction: Outlines the decline in immigrant entry earnings in Canada and explains why gender-specific research is required to properly model the labor market returns for female immigrants.
2. Data: Describes the primary data source (2011 NHS) and the creation of the language proximity index, which categorizes immigrants based on the linguistic link between their source countries and English.
3. The Models: Details the econometric methodology, specifically the Heckman two-step procedure to correct for sample selection bias and the framework for quantile regression to analyze wage distributions.
4. Results: Presents descriptive statistics and regression findings, showing that returns increase with language proficiency and that OLS estimates are biased when sample selection issues are ignored.
5. Conclusion: Summarizes the research findings, emphasizing that language proficiency significantly impacts female immigrant earnings and that policymakers should focus on language training to reduce earnings gaps.
Keywords
Female Immigrants, Canada, Language Proficiency, Returns to Immigrants, Wage Distribution, Quantile Regression, Sample Selection, Heckman Procedure, Labor Market Participation, Linguistic Proximity, Earnings Gap, Human Capital, Immigration Policy, Labor Supply
Frequently Asked Questions
What is the primary focus of this research paper?
The paper focuses on analyzing the relationship between language proficiency and the economic earnings of female immigrants in Canada, specifically addressing how language skills impact different wage distribution levels.
What are the central thematic areas?
The core themes include female labor market participation, the role of linguistic proximity in human capital accumulation, and the impact of sample selection bias on economic modeling.
What is the central research question?
The study aims to answer whether more proficient female immigrant groups perform better in the Canadian labor market and whether language proficiency penalizes those at the higher end of the wage distribution more than those at the lower end.
Which scientific methods are employed?
The author uses Heckman's two-step sample selection correction procedure and applies Buchinsky's quantile regression framework to ensure robust estimations.
What topics are covered in the main body of the work?
The main body covers data acquisition from the 2011 National Household Survey, the construction of language proximity dummies, the technical specification of the models, and empirical results for both mean earnings and wage quantiles.
Which keywords characterize this work?
Key terms include female immigrants, language proficiency, quantile regression, sample selection, and wage distribution.
How is the linguistic proximity index operationalized?
The index uses three dummy variables (L1, L2, L3) to categorize immigrants based on their source country's linguistic connection to English, ranging from no link to English as a mother tongue.
Why does the author argue that OLS estimates can be misleading?
The author argues that OLS estimates are often biased and inconsistent in this context because they fail to account for sample selection bias, specifically regarding individuals who do not participate in the labor market.
What policy implications does the author suggest?
The author suggests that the Canadian government should support language training programs for female immigrants to increase their productivity and narrow existing earnings gaps between different immigrant groups.
- Quote paper
- Idris Ademuyiwa (Author), 2016, Language Proficiency and Returns to Female Immigrants in Canada, Munich, GRIN Verlag, https://www.grin.com/document/343171
