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Estimating the Potential Impact of Combined Race and Ethnicity Reporting on Long-Term Earnings Statistics
September 2024
Working Paper Number:
CES-24-48
We use place of birth information from the Social Security Administration linked to earnings data from the Longitudinal Employer-Household Dynamics Program and detailed race and ethnicity data from the 2010 Census to study how long-term earnings differentials vary by place of birth for different self-identified race and ethnicity categories. We focus on foreign-born persons from countries that are heavily Hispanic and from countries in the Middle East and North Africa (MENA). We find substantial heterogeneity of long-term earnings differentials within country of birth, some of which will be difficult to detect when the reporting format changes from the current two-question version to the new single-question version because they depend on self-identifications that place the individual in two distinct categories within the single-question format, specifically, Hispanic and White or Black, and MENA and White or Black. We also study the USA-born children of these same immigrants. Long-term earnings differences for the 2nd generation also vary as a function of self-identified ethnicity and race in ways that changing to the single-question format could affect.
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Are Immigrants More Innovative? Evidence from Entrepreneurs
November 2023
Working Paper Number:
CES-23-56
We evaluate the contributions of immigrant entrepreneurs to innovation in the U.S. using linked survey-administrative data on 199,000 firms with a rich set of innovation measures and other firm and owner characteristics. We find that not only are immigrants more likely than natives to own businesses, but on average their firms display more innovation activities and outcomes. Immigrant owned firms are particularly more likely to create completely new products, improve previous products, use new processes, and engage in both basic and applied R&D, and their efforts are reflected in substantially higher levels of patents and productivity. Immigrant owners are slightly less likely than natives to imitate products of others and to hire more employees. Delving into potential explanations of the immigrant-native differences, we study other characteristics of entrepreneurs, access to finance, choice of industry, immigrant self-selection, and effects of diversity. We find that the immigrant innovation advantage is robust to controlling for detailed characteristics of firms and owners, it holds in both high-tech and non-high-tech industries and, with the exception of productivity, it tends to be even stronger in firms owned by diverse immigrant-native teams and by diverse immigrants from different countries. The evidence from nearly all measures that immigrants tend to operate more innovative and productive firms, together with the higher share of business ownership by immigrants, implies large contributions to U.S. innovation and growth.
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Leapfrogging the Melting Pot? European Immigrants' Intergenerational Mobility Across the 20th Century
August 2021
Working Paper Number:
CES-21-20
During the early twentieth century, industrial-era European immigrants entered the United States with lower levels of education than the U.S. average. However, empirical research has yielded unclear and inconsistent evidence about the extent and pace of their integration, leaving openings for arguments that contest the narrative that these groups experienced rapid integration and instead assert that educational deficits among lower-status groups persisted across multiple generations. Here, we advance another argument, that European immigrants may have 'leapfrogged' or exceeded U.S.-born non-Hispanic white attainment by the third generation. To assess these ideas, we reconstituted three-generation families by linking individuals across the 1940 Census, years 1973, 1979, 1981-90 of the Current Population Survey, the 2000 Census, and years 2001-2017 of the American Community Survey. Results show that most European immigrant groups not only caught up with U.S.-born whites by the second generation, but surpassed them, and this advantage further increased in the third generation. This research provides a new understanding of the time to integration for 20th century European immigrant groups by showing that they integrated at a faster pace than previously thought, indicative of a process of accelerated upward mobility.
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Using Linked Data to Investigate True Intergenerational Change: Three Generations Over Seven Decades
August 2018
Working Paper Number:
carra-2018-09
It is widely thought that immigrants and their families undergo profound cultural and socioeconomic changes as a consequence of coming into contact with U.S. society, but the way this occurs remains unclear and controversial due in large part to data limitations. In this paper, we provide proof of concept for analyses using linked data that allow us to compare outcomes across more 'exact' family generations. Specifically, we are able to follow immigrant parents and their children and grandchildren across seven decades using census and survey data from 1940 to 2014. We describe the data and linkage methodology, evaluate the representativeness of the linked sample, test a method for adjusting for biases that arise from non-representative linkages, and describe the size, diversity, and socioeconomic characteristics of the linked sample. We demonstrate that large sample sizes of linked data will likely permit us to compare several national origin groups across multiple generations.
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Assimilation and Coverage of the
Foreign-Born Population in Administrative Records
April 2015
Working Paper Number:
carra-2015-02
The U.S. Census Bureau is researching ways to incorporate administrative data in decennial census and survey operations. Critical to this work is an understanding of the coverage of the population by administrative records. Using federal and third party administrative data linked to the American Community Survey (ACS), we evaluate the extent to which administrative records provide data on foreign-born individuals in the ACS and employ multinomial logistic regression techniques to evaluate characteristics of those who are in administrative records relative to those who are not. We find that overall, administrative records provide high coverage of foreign-born individuals in our sample for whom a match can be determined. The odds of being in administrative records are found to be tied to the processes of immigrant assimilation - naturalization, higher English proficiency, educational attainment, and full-time employment are associated with greater odds of being in administrative records. These findings suggest that as immigrants adapt and integrate into U.S. society, they are more likely to be involved in government and commercial processes and programs for which we are including data. We further explore administrative records coverage for the two largest race/ethnic groups in our sample - Hispanic and non-Hispanic single-race Asian foreign born, finding again that characteristics related to assimilation are associated with administrative records coverage for both groups. However, we observe that neighborhood context impacts Hispanics and Asians differently.
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Dynamics of Race: Joining, Leaving, and Staying in the American Indian/Alaska Native Race Category between 2000 and 2010
August 2014
Working Paper Number:
carra-2014-10
Each census for decades has seen the American Indian and Alaska Native population increase substantially more than expected. Changes in racial reporting seem to play an important role in the observed net increases, though research has been hampered by data limitations. We address previously unanswerable questions about race response change among American Indian and Alaska Natives (hereafter 'American Indians') using uniquely-suited (but not nationally representative) linked data from the 2000 and 2010 decennial censuses (N = 3.1 million) and the 2006-2010 American Community Survey (N = 188,131). To what extent do people change responses to include or exclude American Indian? How are people who change responses similar to or different from those who do not? How are people who join a group similar to or different from those who leave it? We find considerable race response change by people in our data, especially by multiple-race and/or Hispanic American Indians. This turnover is hidden in cross-sectional comparisons because people joining the group are similar in number and characteristics to those who leave the group. People in our data who changed their race response to add or drop American Indian differ from those who kept the same race response in 2000 and 2010 and from those who moved between a single-race and multiple-race American Indian response. Those who consistently reported American Indian (including those who added or dropped another race response) were relatively likely to report a tribe, live in an American Indian area, report American Indian ancestry, and live in the West. There are significant differences between those who joined and those who left a specific American Indian response group, but poor model fit indicates general similarity between joiners and leavers. Response changes should be considered when conceptualizing and operationalizing 'the American Indian and Alaska Native population.'
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HUMAN CAPITAL TRAPS? ENCLAVE EFFECTS USING LINKED EMPLOYER-HOUSEHOLD DATA
June 2013
Working Paper Number:
CES-13-29
This study uses linked employer-household data to measure the impact of immigrant social networks, as identified via neighborhood and workplace affiliation, on immigrant earnings. Though ethnic enclaves can provide economic opportunities through job creation and job matching, they can also stifle the assimilation process by limiting interactions between enclave members and non-members. I find that higher residential and workplace ethnic clustering among immigrants is consistently correlated with lower earnings. For immigrants with a high school education or less, these correlations are primarily due to negative self-selection. On the other hand, self-selection fails to explain the lower earnings associated with higher ethnic clustering for immigrants with post-secondary schooling. The evidence suggests that co-ethnic clustering has no discernible effect on the earnings of immigrants with lower education, but may be leading to human capital traps for immigrants who have more than a high school education.
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COMMUNITY DETERMINANTS OF IMMIGRANT SELF-EMPLOYMENT: HUMAN CAPITAL SPILLOVERS AND ETHNIC ENCLAVES
April 2013
Working Paper Number:
CES-13-21
I find evidence that human capital spillovers have positive effects on the proclivity of low human capital immigrants to self-employ. Human capital spillovers within an ethnic community can increase the self-employment propensity of its members by decreasing the costs associated with starting and running a business (especially, transaction costs and information costs). Immigrants who do not speak English and those with little formal education are more likely to be self-employed if they reside in an ethnic community boasting higher human capital. On the other hand, the educational attainment of co-ethnics does not appear to affect the self-employment choices of immigrants with a post-secondary education to become self-employed. Further analysis suggests that immigrants in communities with more human capital choose industries that are more capital-intensive. Overall, the results suggest that the communities in which immigrants reside influences their self-employment decisions. For low-skilled immigrants who face high costs to learning English and/or acquiring more education, these human capital spillovers may serve as an alternative resource of information and labor mobility.
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Migration and Dispersal of Hispanic and Asian Groups: An Analysis of the 2006-2008 Multiyear American Community Survey
October 2011
Working Paper Number:
CES-11-33
This report seeks to evaluate selective migration processes of Hispanic and Asian nationality groups in the US from established settlement areas, using recent migration data from the American Community Survey. The underlying goal is to detect migration tendencies leading toward an increased dispersion of these groups associated with their migration processes. Using descriptive statistics, maps, and migration models, we assess how migration processes in the 2006-8 period are leading to the dispersal of Hispanic and Asian race ethnic groups across metropolitan areas, with special attention to the roles of co-ethnic communities and spatial assimilation. These analyses employ migration data available from the 3-year 2006-8 American Community Survey using restricted data from the US Census Bureau's Research Data Centers. This use of the restricted ACS files permitted the first post 2000 analysis of inter-metropolitan migration for Hispanic groups (Mexicans, Puerto Ricans, Cubans, Salvadorans, Dominicans) and Asian groups (Chinese, Indians, Filipinos, Vietnamese, Koreans) using the detailed demographic and geographic attributes available with these files. The data and analysis presented here provide a benchmark for further research of this kind with the American Community Survey in light of the fact that migration data will no longer be available from the US decennial census. The study examines migration from these groups' major settlement areas to other metropolitan area destinations as they are affected by the attraction of co-ethnic communities and by a migrant selectivity pattern consistent with the perspective of spatial assimilation. The migration processes themselves were evaluated in terms of two components: the out--migration rates of residents, and the destination selection of movers. From the perspective of co-ethnic community attraction, it was hypothesized that the outmigration rates from high co-ethnic settlement areas would be lower than those from areas where the group had a smaller overall presence and that the destination selections of out-migrants would be positively affected by the presence of high co-ethnic population shares in destination areas. From the spatial assimilation perspective, it was hypothesized that out-migration from high coethnic areas would least likely occur for group members with lowest education, poor facility with English, and recently arrived in the US; whereas the selection of destinations with large coethnic population shares would be most likely to occur for these same population categories. The results strongly confirm that co-ethnic community attraction continues to reduce outmigration of groups from major settlement origins and positively influences their destination selections. A series of multivariate migrant destination selection models confirm a consistent draw of ethnically similar destinations across individual Hispanic and Asian groups when other economic, demographic and structural metropolitan attributes are taken into account. In contrast, results regarding spatial assimilation are typically mixed or nonexistent in characterizing both out-migration and mover destination selectivity patterns. In fact, we find contrary evidence for some Asian groups for whom it is the most educated, and native born migrants who show a penchant for selecting destinations with greater co-ethnic population shares. Among the greatest destinations for Indians, for example, are Philadelphia, Seattle, Dallas, Boston and Atlanta- areas with higher than average Indian population shares, and areas that also house knowledge-based industries. The selection of co-ethnic destinations among Hispanic group migrants appears somewhat impervious to education attainment and Hispanic and Mexican group movers, who are foreign born and who arrived since 2000, are least, rather than most, prone to select co-ethnic destinations. The mover destination models make plain that employment growth at destination provides a strong draw for all Hispanic groups. This suggests that recent growth in low skilled jobs in parts of the country with small Hispanic populations are nonetheless attracting newly arrived, and less skilled Mexicans and other Hispanics who might have previously been especially lured to destinations with large co-ethnic population shares.
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Bank Crises and Investor Confidence
January 2009
Working Paper Number:
CES-09-02
In addition to their direct effects, episodes of financial instability may decrease investor confidence. Measuring the impact of a crisis on investor confidence is complicated by the fact that it is difficult to disentangle the effect of investor confidence from coincident direct effects of the crisis. In order to isolate the effects of financial crises on investor confidence, we study the investment behavior of immigrants in the U.S. Our findings indicate that systemic banking crises have important effects on investor behavior. Immigrants who have experienced a banking crisis in their countries of origin are significantly less likely to have bank accounts in the U.S. This finding is robust to including important individual controls like wealth, education, income, and age. In addition, the effect of crises is robust to controlling for a variety of country of origin characteristics, including measures of financial and economic development and specifications with country of origin fixed effects.
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