Oskar Jost (p), Stephan Brunow

Annekatrin Niebuhr

Our paper puts new light on the decomposition of the wage gap between foreign and native employees in Germany. A general problem of such analyses is the chosen reference or comparison group. We overcome this problem by choosing an unbiased reference group that is neither discriminated nor preferred within a firm: German employees who work in firms that solely employ Germans. Our results show higher wages for foreign workers than for natives given their observable factors. We compare our findings to the results of the orthodox reference group in this context: German employees working in firms employing Germans and foreigners. Doing this, we find that observable factors explain almost the whole wage gap. To illustrate the economic implication of our findings we convert the effects of the observed factors on the wage gap into actual Euro amounts. Our results lead us to the conclusion that discrimination is negligible from an economic point of view. In addition, we can confirm some findings from previous studies: In particular, low-skilled foreign employees earn significantly higher wages than low-skilled German workers. In order to take a closer look at this circumstance and to increase the validity of our results, we take particular account of potential selectivity as well as a possible overqualification of foreign workers.

Masood Gheasi (p), Daniel Crown , Alessandra Faggian

Oskar Jost

This paper contributes to the interregional migration literature by estimating whether individual personality traits, which are typically unobservable in survey data, influence the propensity to engage in interregional migration. We specifically examine the big-five personality traits of: extraversion, openness to experience, conscientiousness, agreeableness, and emotional stability. Our findings suggest that individuals with higher levels of extraversion and openness to experience are more likely to migrate. Moreover, individuals with low levels of agreeableness and emotional stability are more likely to migrate multiple times. Overall, our results show that the personality traits are significant factors in the migration decision. To the extent that personality traits are rewarded in the labor market, these unobservable traits will confound naïve estimates of the pecuniary return to migration.

Annekatrin Niebuhr (p), Christian Teichert, Anne Otto, Anja Rossen

Masood Gheasi

We use administrative social security records and event history analysis to investigate the significance of previous work experience for the migration decision of German university graduates. The regression results suggest that work experience gained previously and while studying in the university region reduces the likelihood of graduates out-migrating, while extra-regional work activity enhances the probability of labour market entry outside the region of study. The size of the effect depends on the type of work experience. The findings point to the importance of knowledge about local labour markets and social networks for graduates’ migration decision at the start of their career.