Project in detail

Human Capital or Discrimination? Labor Market Entry Disadvantages of Second-Generation Turkish Migrants in Germany

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Earlier studies disagree over whether average differences in human capital endowments or employer discrimination explain second-generation migrants’ disadvantages at labor market entry. I use data from the German Socioeconomic Panel Study to comprehensively test the human capital mechanism as well as corollary hypotheses derived from statistical and taste discrimination theory. I find human capital, including receiving-country specific resources as e.g. German language abilities or the ethnic composition of networks, to not fully explain the ethnic penalties Turkish migrants experience when entering the labor market. When analyzing who starts and completes a vocational education, significant residual effects for the Turkish remain. Estimating labor market entry models, I find vocational education to be one of the strongest predictors of a successful transition into paid labor. Finally, interaction models show that a completed vocational education pays off less for Turkish migrants as compared to German graduates. The latter finding can be interpreted as evidence for statistical discrimination.

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