Heterogeneity in marginal returns to language training of immigrants

Matthias Giesecke and Eric Schuss

No 812, Ruhr Economic Papers from RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen

Abstract: We estimate the effect of language training on subsequent employment and wages of immigrants under essential heterogeneity. The identifying variation is based on regional differences in language training availability that we use to instrument endogenous participation. Estimating marginal treatment effects along the distribution of observables and unobservables that drive individual participation decisions, we find that immigrants with higher gains are more likely to select into language training than immigrants with lower gains. We document up to 15% higher employment rates and 13% wage gains for immigrants with a high desire to participate but the positive returns vanish with increasing resistance to treatment. This pattern of selection on gains correlates with unobserved ability and motivation, promoting investments in education and job-specific skills that yield higher returns when complemented by language capital in the host country.

Keywords: language training; heterogeneous returns; marginal treatment effects; continuous instrument (search for similar items in EconPapers)
JEL-codes: F22 J24 J61 J68 O15 (search for similar items in EconPapers)
Date: 2019
New Economics Papers: this item is included in nep-eur, nep-lma and nep-ure
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Citations: View citations in EconPapers (7)

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Working Paper: Heterogeneity in marginal returns to language training of immigrants (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:rwirep:812

DOI: 10.4419/86788941

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