# Labor Market Segmentation and Immigrant Competition: A Quantal Response Statistical Equilibrium Analysis

## Abstract

**:**

## 1. Introduction

## 2. Labor Market Competition and the Incomplete Data Problem

#### A Maximum Entropy Solution

## 3. Smithian Class of Labor Competition Models

#### 3.1. Quantal Response Statistical Equilibrium

#### 3.1.1. Quantal Response Behavior

#### 3.1.2. Competitive Feedback

#### 3.2. Labor Market Competition with Heterogeneous Workers

## 4. Data

## 5. Labor Competition among Broad Racial and Ethnic Groups in the US

#### Asymmetric Labor Market Competition between Immigrant and Native Workers

## 6. Discussion

#### Limitations and Avenues for Future Research

## 7. Conclusions

## Funding

## Acknowledgments

## Conflicts of Interest

## Appendix A. Mathematical Appendix

#### Appendix A.1. Analytical Results

#### Appendix A.2. Estimation Approach

## Appendix B. Supplementary Materials

**Table A1.**Summary statistics by sex, ethnic/racial group and census year. Sample size (N), mean and standard deviation (SD) based on the effective sample, below the 98th percentile (P98) cut-off. Dropped categories highlighted.

Year | Sex | Identity | N | Mean | SD | P98 |
---|---|---|---|---|---|---|

1970 | Male | Black Immig. | 429 | 587 | 261 | 1856 |

1970 | Male | Black Native | 56,148 | 549 | 275 | 1856 |

1970 | Male | Hispanic Immig. | 3832 | 607 | 295 | 1856 |

1970 | Male | Hispanic Native | 15,828 | 649 | 305 | 1856 |

1970 | Male | White Immig. | 10,919 | 830 | 342 | 1856 |

1970 | Male | White Native | 517,098 | 804 | 332 | 1856 |

1970 | Female | Black Immig. | 437 | 416 | 231 | 1856 |

1970 | Female | Black Native | 45,135 | 365 | 262 | 1856 |

1970 | Female | Hispanic Immig. | 2113 | 382 | 209 | 1856 |

1970 | Female | Hispanic Native | 6846 | 400 | 239 | 1856 |

1970 | Female | White Immig. | 7341 | 449 | 251 | 1856 |

1970 | Female | White Native | 298,407 | 450 | 266 | 1856 |

1980 | Male | Black Immig. | 5703 | 599 | 315 | 1974 |

1980 | Male | Black Native | 130,068 | 634 | 331 | 1974 |

1980 | Male | Hispanic Immig. | 36,750 | 586 | 317 | 1974 |

1980 | Male | Hispanic Native | 55,001 | 678 | 332 | 1974 |

1980 | Male | White Immig. | 47,538 | 848 | 388 | 1974 |

1980 | Male | White Native | 1,316,415 | 830 | 364 | 1974 |

1980 | Female | Black Immig. | 5720 | 464 | 242 | 1974 |

1980 | Female | Black Native | 132,998 | 454 | 273 | 1974 |

1980 | Female | Hispanic Immig. | 22,587 | 387 | 222 | 1974 |

1980 | Female | Hispanic Native | 36,460 | 421 | 243 | 1974 |

1980 | Female | White Immig. | 40,318 | 452 | 267 | 1974 |

1980 | Female | White Native | 977,997 | 456 | 266 | 1974 |

1990 | Male | Black Immig. | 8761 | 633 | 352 | 2249 |

1990 | Male | Black Native | 121,871 | 640 | 357 | 2249 |

1990 | Male | Hispanic Immig. | 69,225 | 533 | 326 | 2249 |

1990 | Male | Hispanic Native | 68,038 | 680 | 362 | 2249 |

1990 | Male | White Immig. | 44,507 | 890 | 455 | 2249 |

1990 | Male | White Native | 1,478,983 | 821 | 411 | 2249 |

1990 | Female | Black Immig. | 8664 | 547 | 308 | 2249 |

1990 | Female | Black Native | 147,365 | 513 | 313 | 2249 |

1990 | Female | Hispanic Immig. | 42,444 | 403 | 268 | 2249 |

1990 | Female | Hispanic Native | 57,304 | 488 | 294 | 2249 |

1990 | Female | White Immig. | 40,923 | 536 | 340 | 2249 |

1990 | Female | White Native | 1,309,195 | 522 | 325 | 2249 |

2000 | Male | Black Immig. | 13,797 | 677 | 417 | 2800 |

2000 | Male | Black Native | 117,753 | 680 | 402 | 2800 |

2000 | Male | Hispanic Immig. | 100,629 | 531 | 352 | 2800 |

2000 | Male | Hispanic Native | 73,818 | 710 | 411 | 2800 |

2000 | Male | White Immig. | 48,137 | 941 | 567 | 2800 |

2000 | Male | White Native | 1,319,736 | 870 | 484 | 2800 |

2000 | Female | Black Immig. | 14,245 | 585 | 369 | 2800 |

2000 | Female | Black Native | 152,063 | 571 | 362 | 2800 |

2000 | Female | Hispanic Immig. | 60,318 | 415 | 307 | 2800 |

2000 | Female | Hispanic Native | 71,750 | 542 | 349 | 2800 |

2000 | Female | White Immig. | 42043 | 619 | 436 | 2800 |

2000 | Female | White Native | 1,261,430 | 597 | 390 | 2800 |

2010 | Male | Black Immig. | 20,759 | 632 | 417 | 2711 |

2010 | Male | Black Native | 127,333 | 630 | 402 | 2711 |

2010 | Male | Hispanic Immig. | 145,403 | 477 | 327 | 2711 |

2010 | Male | Hispanic Native | 107,518 | 683 | 428 | 2711 |

2010 | Male | White Immig. | 57,760 | 917 | 587 | 2711 |

2010 | Male | White Native | 1,506,568 | 837 | 498 | 2711 |

2010 | Female | Black Immig. | 23,667 | 558 | 380 | 2711 |

2010 | Female | Black Native | 182,544 | 535 | 360 | 2711 |

2010 | Female | Hispanic Immig. | 101,029 | 372 | 287 | 2711 |

2010 | Female | Hispanic Native | 113,748 | 533 | 356 | 2711 |

2010 | Female | White Immig. | 55,435 | 638 | 470 | 2711 |

2010 | Female | White Native | 1,528,697 | 603 | 410 | 2711 |

**Figure A1.**Histogram of observed wage distributions for women, and overlaid fitted marginal (solid) and conditional (dashed) wage distributions. Estimated jointly for all ethnicity groups using the asymmetric Beta QRSE model. 1970–2010 Census and ACS data.

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**Figure 1.**Histogram of marginal wage distributions for 2010 ACS data by sex. Overlaid three different specifications of the QRSE model fitted to the data.

**Figure 2.**Soofi’s informational distinguishability/goodness of fit measure for the three QRSE model speficiations, by ethnicity. 1970–2010 Census and ACS data.

**Figure 3.**Histogram of observed wage distributions for men, and overlaid fitted marginal (solid) and conditional (dashed) wage distributions. Estimated jointly for all ethnicity groups using the asymmetric Beta QRSE model. 1970–2010 Census and ACS data.

**Figure 4.**Predicted behavioral responses by race/ethnicity and gender. Selected years, Census and ACS data.

**Figure 5.**Quantal response reference wages (${\mu}_{m}$) and behavioral temperatures (${T}_{m}$) by race/ethnicity and gender. Estimated from the asymmetric QRSE model. 1970–2010 Census and ACS data.

**Figure 6.**Estimated competitive feedback parameters for the impact of exit (${\beta}_{exit}$) and entry (${\beta}_{enter}$) by gender. 1970–2010 Census and ACS data.

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Wiener, N.M.
Labor Market Segmentation and Immigrant Competition: A Quantal Response Statistical Equilibrium Analysis. *Entropy* **2020**, *22*, 742.
https://doi.org/10.3390/e22070742

**AMA Style**

Wiener NM.
Labor Market Segmentation and Immigrant Competition: A Quantal Response Statistical Equilibrium Analysis. *Entropy*. 2020; 22(7):742.
https://doi.org/10.3390/e22070742

**Chicago/Turabian Style**

Wiener, Noé M.
2020. "Labor Market Segmentation and Immigrant Competition: A Quantal Response Statistical Equilibrium Analysis" *Entropy* 22, no. 7: 742.
https://doi.org/10.3390/e22070742