Immigrant Earnings Adjustment: The Impact of Age at Migration
Human capital theory, in conjunction with Chiswick's (1978) and Borjas' (1998) work, implies the post-migration path of immigrant earnings is likely to depend on the age at migration. An adaptation of Borjas' (1998) model of immigrant wage determination is presented which predicts, for a given stock of human capital at the point of migration, lower initial earnings for younger arrivals, but faster earnings growth with time in the destination country. Empirical tests on data for Australian immigrants provide qualified support for the hypothesis that initial wages are, ceteris paribus, increasing in age at migration and the rate of wage growth is decreasing in age at migration. Copyright Blackwell Publishing Ltd/University of Adelaide and Flinders University of South Australia 2003.
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