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Immigrants’ Earnings Assimilation: Evidence from Longitudinal Earnings Records

Andres Villarreal compares immigrants' long-term earnings to those of native citizens, using a unique dataset

Whether immigrants to the U.S. are assimilating economically has important implications for their well-being and that of their children. One key measure of economic assimilation is immigrants’ ability to reduce the earnings gap with natives over their life course. In this study, Dr. Villarreal will examine immigrants’ earnings trajectories, and measure the extent to which the earnings gap with natives narrows over time, using a unique dataset that links respondents of the Survey of Income and Program Participation (SIPP) to their longitudinal earnings from individual tax records. He will follow immigrants’ earnings for up to 20 years after arrival and compare their earnings trajectory to that of similarly-qualified natives.

This longitudinal approach offers better estimates of the economic assimilation of foreign-born individuals over time than an approach using synthetic cohorts based on repeated cross sections. Dr. Villarreal will explore differences in the earnings trajectory of immigrants according to their level of education, country of origin, and racial and ethnic identification. He will also examine differences in earnings growth by immigrant cohort to test the so-called declining “quality” of immigrants over time. Finally, the study will consider how two features of immigrants’ initial experience in the U.S. influence their ability to narrow the earnings gap with natives, namely their visa status upon arrival and self-employment during the first three years in the U.S.