Gender, comparative advantage and labor market activity in immigrant families
The family investment hypothesis predicts that credit-constrained immigrant families adopt a household strategy for financing post-migration human capital investment in which the partner with labor market comparative advantage engages in investment activities and the other partner undertakes labor market activities which finance current consumption. We assess this hypothesis by focusing on two issues: first, the extent to which the specialization in the investing versus financing role is based on comparative advantage versus gender, and second, the extent to which credit constraints offer a potential explanation for observed behavior. Using a unique new Australian data set we find that comparative advantage and gender can be separately identified in migrating families. We find some support for the family investment hypothesis among traditional families (where labor market comparative advantage resides with the male partner) but not among nontraditional families.
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analysis assimilation Australian National University Baker and Benjamin Beach and Worswick behavior of immigrant cohort effects credit constraints Duleep and Sanders dummies Dustmann earnings Empirical employed participant enrolled Employment evidence families column family investment hypothesis female partner Female Principal Applicant gender and comparative gender roles heterogeneity in preferences High School High human capital investment hypothesis among traditional immigrant and mixed immigrant behavior immigrant couples immigrant households immigrant women Immigrants to Australia IZA Discussion Papers labor economics labor market activities labor market comparative Linear probability models LSIA data MacPherson and Stewart Male market comparative advantage Married to Immigrant mixed families native-born nontraditional families observable characteristics p-Value Panel Data Pearson x2 percent points test post-migration human capital principal applicant status region of origin sample secondary workers married separately identify skill-based Soest t-statistics Table Third Interview traditional families traditional households variation in preferences visa category wage White's heteroscedasticity consistent workers in immigrant