Labour Mobility of Immigrants: Training, Experience, Language and Opportunities
Bar Ilan University - Department of Economics; Institute for the Study of Labor (IZA)
Tel Aviv University - Eitan Berglas School of Economics; University of Minnesota, Twin Cities - Department of Economics; Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA)
CEPR Discussion Paper No. 3412
This paper analyses the labour mobility and human capital accumulation of male immigrants who moved from the former Soviet Union to Israel. We formulate an estimable dynamic choice model for employment and training in blue and white-collar occupations, where the labour market randomly offered opportunities are affected by past choices. The estimated model well fits the observed patterns of the fast decrease in unemployment as immigrants first find blue-collar jobs and attend training, followed by a gradual movement to white-collar occupations. The estimated rates of return to local training, local experience and local language are very high, but imported skills have zero (conditional) return. Furthermore, the welfare gain from the impact of training on job offer probabilities is larger than its effect on wages. Due to low job offer rates, the realized rate of return from white-collar training is relatively low and takes time. As a result, the annual aggregate wage growth, due to the availability of training programs, increases with time in Israel to 1.4% in the fifth year.
Number of Pages in PDF File: 54
Keywords: Immigration, occupation, training, unemployment, transitions, welfare
JEL Classification: J31, J68working papers series
Date posted: July 31, 2002
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