The Immigrant-Native Wage Gap in Germany Revisited

Kai Ingwersen and Stephan Thomsen

Hannover Economic Papers (HEP) from Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät

Abstract: This study provides new evidence on the levels of economic integration experienced by foreigners and naturalised immigrants relative to native Germans from 1994 to 2015. We decompose the wage gap using the method for unconditional quantile regression models by employing a regression of the (recentered) influence function (RIF) of the gross hourly wage on a rich set of explanatory variables. This approach enables us to estimate contributions made across the whole wage distribution. To allow for a detailed characterization of labour market conditions, we consider a comprehensive set of socio-economic and labour-related aspects capturing influences of, e.g., human capital quality, cultural background, and the personalities of immigrants. The decomposition results clearly indicate a significant growing gap with higher wages for both foreigners (13.6 to 17.6 percent) and naturalised immigrants (10.0 to 16.4 percent). The findings further display a low explanation for the wage gap in low wage deciles that is even more pronounced within immigrant subgroups. Cultural and economic distances each have a significant influence on wages. A different appreciation of foreign educational qualifications, however, widens the wage gap substantially by 4.5 ppts on average. Moreover, we observe an indication of deterioration of immigrants’ human capital endowments over time relative to those of native Germans.

Keywords: Immigration; wage gap; unconditional quantile regression; Germany (search for similar items in EconPapers)
JEL-codes: J15 J31 J61 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2019-05
New Economics Papers: this item is included in nep-eur, nep-lab and nep-mig
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://diskussionspapiere.wiwi.uni-hannover.de/pdf_bib/dp-653.pdf (application/pdf)

Related works:
Journal Article: The immigrant-native wage gap in Germany revisited (2021)
Working Paper: The Immigrant-Native Wage Gap in Germany Revisited (2019)
Working Paper: The Immigrant-Native Wage Gap in Germany Revisited (2019)
Working Paper: The Immigrant-Native Wage Gap in Germany Revisited (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:han:dpaper:dp-653

Access Statistics for this paper

More papers in Hannover Economic Papers (HEP) from Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät Contact information at EDIRC.
Bibliographic data for series maintained by Heidrich, Christian ().