The Economic Outcomes of an Ethnic Minority: The Role of Barriers

40 Pages Posted: 13 Apr 2020

See all articles by Nitsa (Kaliner) Kasir

Nitsa (Kaliner) Kasir

Haredi Institute for Policy Studies

Eran Yashiv

Tel Aviv University - Eitan Berglas School of Economics; CEP, LSE; IZA Institute of Labor Economics; Centre for Economic Policy Research (CEPR)

Abstract

The Arab population in Israel constitutes an ethnic minority, at around 20% of the population. The economy of this minority is characterized by inferior outcomes relative to the Jewish majority by all indicators, including employment, wages, occupational status, social welfare, education, and housing. This paper reviews key data facts and presents a model of barriers to integration facing Arabs in Israel, taking it to the data. The empirical analysis, based on a general equilibrium model of occupational choice with optimizing agents and barriers, points to an increase over time in barriers to the acquisition of human capital in highly skilled occupations, and, concurrently, a reduction in labor market barriers in all occupations. The analysis offers insights relevant to other developed economies with large ethnic minorities.

Keywords: ethnic minority, economic outcomes, human capital barriers, labor market barriers, occupational choice

JEL Classification: J15, J24

Suggested Citation

Kasir, Nitsa (Kaliner) and Yashiv, Eran, The Economic Outcomes of an Ethnic Minority: The Role of Barriers. IZA Discussion Paper No. 13120, Available at SSRN: https://ssrn.com/abstract=3573290 or http://dx.doi.org/10.2139/ssrn.3573290

Nitsa (Kaliner) Kasir

Haredi Institute for Policy Studies

Israel

Eran Yashiv (Contact Author)

Tel Aviv University - Eitan Berglas School of Economics ( email )

P.O. Box 39040
Ramat Aviv, Tel Aviv, 69978
Israel
+972 3 640 9715 (Phone)
+972 3 640 9908 (Fax)

HOME PAGE: http://www.tau.ac.il/~yashiv/

CEP, LSE ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

IZA Institute of Labor Economics

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

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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