Foreign Workers and the Wage Distribution: What Does the Influence Function Reveal?
AbstractThis paper draws upon influence function regression methods to determine where foreign workers stand in the distribution of private sector wages in Luxembourg, and assess whether and how much their wages contribute to wage inequality. This is quantified by measuring the effect that a marginal increase in the proportion of foreign workers—foreign residents or cross-border workers—would have on selected quantiles and measures of inequality. Analysis of the 2006 Structure of Earnings Survey reveals that foreign workers have generally lower wages than natives and therefore tend to haul the overall wage distribution downwards. Yet, their influence on wage inequality reveals small and negative. All impacts are further muted when accounting for human capital and, especially, job characteristics. Not observing any large positive inequality contribution on the Luxembourg labour market is a striking result given the sheer size of the foreign workforce and its polarization at both ends of the skill distribution. View Full-Text
A printed edition of this Special Issue is available here.
Share & Cite This Article
Choe, C.; Van Kerm, P. Foreign Workers and the Wage Distribution: What Does the Influence Function Reveal? Econometrics 2018, 6, 41.
Choe C, Van Kerm P. Foreign Workers and the Wage Distribution: What Does the Influence Function Reveal? Econometrics. 2018; 6(3):41.Chicago/Turabian Style
Choe, Chung; Van Kerm, Philippe. 2018. "Foreign Workers and the Wage Distribution: What Does the Influence Function Reveal?" Econometrics 6, no. 3: 41.
Note that from the first issue of 2016, MDPI journals use article numbers instead of page numbers. See further details here.