Immigration in Canada: Context, assimilation and labour market impacts

grantor: University of TorontoIn Chapter I, I introduce the reader to immigration in Canada. This includes the contextual environment, immigration policies and brief reviews of three types of immigrant studies: those on assimilation, those on take-up rates of transfer payments and those on the labour market impact of immigration on native-born Canadians. In Chapter II, I investigate the economic assimilation experienced by immigrants over the 1980s. Previous studies of the labour market experience of male immigrants to Canada have uncovered two disturbing trends: declining entry earnings for successive new immigrant cohorts, and low assimilation rates. These findings suggest that many cohorts may never assimilate. The 1991 Census provides a first look at the immigrant cohorts arriving in the 1980's. These immigrants appear to avoid the plight of their predecessors; entry earnings have stopped falling, and those immigrants arriving between 1981 and 1985 experienced a 17% assimilation rate. I am unable to explain this turnaround based on the observable characteristics recorded in the census data. In Chapter III, I explore the economic impact of immigrants! presence within the Canadian labour market on the wages of native-born Canadians and earlier immigrants. Most of the existing evidence on this question uses data from the United States and finds no impact. In this paper I estimate the impact of immigration on native wages using Canadian data, paying close attention to the important econometric issues, such as the potential endogeneity of immigrants' choice of location upon arrival. The "labour market" is defined by occupations. Two important innovations are the use of immigrant source-country characteristics and immigrants' intended occupation at entry as instruments in predicting immigration flows to the labour market. My results consistently point to no evidence of adverse effects of immigrants on the labour market outcomes of native-born Canadians. This chapter also contains an analysis of the impact of immigration on educational and age wage differentials. Larger impacts are found on the wage differential between young and older workers. Lastly, I find some evidence that natives exit labour markets that immigrants enter and that new immigrants may be confined to lower paying occupations.Ph.D