Ethnic Concentration and Language Fluency of Immigrants in Germany

53 Pages Posted: 15 Feb 2010

See all articles by Alexander M. Danzer

Alexander M. Danzer

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics; IZA Institute of Labor Economics

Firat Yaman

City University London - Department of Economics

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Abstract

Studies that investigate the effect of the regional ethnic composition on immigrant outcomes have been complicated by the self-selection of ethnic minorities into specific neighbourhoods. We analyse the impact of own-ethnic concentration on the language proficiency of immigrants by exploiting the fact that the initial placement of guest-workers after WWII was determined by labour demanding firms and the federal labour administration and hence exogenous to immigrant workers. Combining several data sets, we find a small but robust and significant negative effect of ethnic concentration on immigrants' language ability. Simulation results of a choice model in which location and learning decisions are taken simultaneously confirm the presence of the effect. Immigrants with high learning costs are inclined to move to ethnic enclaves, so that the share of German-speakers would increase only modestly even under the counterfactual scenario of a regionally equal distribution of immigrants across Germany.

Keywords: enclave, ethnic concentration, language proficiency, immigrants, Instrumental variable, random utility model

JEL Classification: J61, R23, F22

Suggested Citation

Danzer, Alexander M. and Yaman, Firat, Ethnic Concentration and Language Fluency of Immigrants in Germany. IZA Discussion Paper No. 4742, Available at SSRN: https://ssrn.com/abstract=1552676 or http://dx.doi.org/10.2139/ssrn.1552676

Alexander M. Danzer (Contact Author)

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics ( email )

Ludwigstrasse 28
Munich, D-80539
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Firat Yaman

City University London - Department of Economics ( email )

Northampton Square
London, EC1V 0HB
United Kingdom

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