Self-Selection and the Earnings of Immigrants

Abstract

This paper analyzes the way in which the earnings of the immigrant population may be expected to differ from the earnings of the native population because of the endogeneity of the migration decision. The conditions that determine the nature of the self -selection are derived and depend on economic and political characteristics of the sending and receiving countries. The empirical analysis shows that differences in the U.S. earnings of immigrants with the same measured skills, but from different home countries, are attributable to variations in conditions in the country of origin at the time of migration.