Canada is currently experiencing immigration rates which are as great as those at the turn of...
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Canada is currently experiencing immigration rates which are as great as those at the turn of the century. This has engendered several movements across the Canada challenging current immigration 1 policy and seeking to limit immigration. In reality though, are immigrants an economic and social burden to Canadian native-born citizens? To address this question, we use wage data from Statistics Canada on 100000 people to estimate the relationship between the natural log of wages and a set of background characteristics, an indicator for immigrant status, and years since arrival in Canada (set equal to 0 for natives and actual years for immigrants). a) Do immigrants earn more or less than their native counterparts without controlling for any other covariates? Is this difference statistically significant? b) Fill in the ??? in the table. c) Do education, experience and experience squared add explanatory power to model (2) over model (1)? What does the R-square of model (2) measure? d) Interpret the coefficient on the immigrant dummy in Model (4). How might you explain the behaviour of the immigrant coefficient up through model (4)? e) Several economists argue that to truly measure the earnings difference between immigrants and non-immigrants, one must consider how long an individual has been in Canada. The rationale is that the longer one has been in Canada, the more "assimilated" one becomes, the estimated immigrant coefficient in model (4) may be biased (up or down?). Does the inclusion of years since arrival in column (5) improve the model? f) What happens when one controls for years since arrival? Is there a difference between immigrants and non-immigrants? At what point do immigrants surpass natives in earnings? g) Do you believe there are limitations with either the data or the analysis? What do you conclude about the economic assimilation of immigrants and their potential impact on social services in Canada? Immigrant Experience Experience Squared Education Female Married TABLE 1 THE ECONOMIC ASSIMILATION OF IMMIGRANTS Dependent Variable: In(wage); Standard Errors are in Parentheses Years in Canada Unexplained Sum of Squares (SSE) R-Square (1) -0.129 (0.006) (2) -0.014 (0.006) 0.033 (0.001) Yes 0.113 (0.001) (3) -0.008 (0.006) 0.033 (0.001) yes 0.114 (0.001) -0.611 (0.003) -0.009 (0.006) 0.031 (0.001) yes 0.113 (0.001) -0.607 (0.003) 0.056 (0.004) (5) -0.140 (0.009) 0.031 (0.001) yes 0.113 (0.001) -0.607 (0.003) 0.056 (0.004) 0.008 (0.0003) ??? 211,732 191,064 ??? 167,370 0.0016 ??? 0.2100 ??? 0.2119 Note: Education is measured as years of education completed; experience is measured as the individual's age minus education minus six. Canada is currently experiencing immigration rates which are as great as those at the turn of the century. This has engendered several movements across the Canada challenging current immigration 1 policy and seeking to limit immigration. In reality though, are immigrants an economic and social burden to Canadian native-born citizens? To address this question, we use wage data from Statistics Canada on 100000 people to estimate the relationship between the natural log of wages and a set of background characteristics, an indicator for immigrant status, and years since arrival in Canada (set equal to 0 for natives and actual years for immigrants). a) Do immigrants earn more or less than their native counterparts without controlling for any other covariates? Is this difference statistically significant? b) Fill in the ??? in the table. c) Do education, experience and experience squared add explanatory power to model (2) over model (1)? What does the R-square of model (2) measure? d) Interpret the coefficient on the immigrant dummy in Model (4). How might you explain the behaviour of the immigrant coefficient up through model (4)? e) Several economists argue that to truly measure the earnings difference between immigrants and non-immigrants, one must consider how long an individual has been in Canada. The rationale is that the longer one has been in Canada, the more "assimilated" one becomes, the estimated immigrant coefficient in model (4) may be biased (up or down?). Does the inclusion of years since arrival in column (5) improve the model? f) What happens when one controls for years since arrival? Is there a difference between immigrants and non-immigrants? At what point do immigrants surpass natives in earnings? g) Do you believe there are limitations with either the data or the analysis? What do you conclude about the economic assimilation of immigrants and their potential impact on social services in Canada? Immigrant Experience Experience Squared Education Female Married TABLE 1 THE ECONOMIC ASSIMILATION OF IMMIGRANTS Dependent Variable: In(wage); Standard Errors are in Parentheses Years in Canada Unexplained Sum of Squares (SSE) R-Square (1) -0.129 (0.006) (2) -0.014 (0.006) 0.033 (0.001) Yes 0.113 (0.001) (3) -0.008 (0.006) 0.033 (0.001) yes 0.114 (0.001) -0.611 (0.003) -0.009 (0.006) 0.031 (0.001) yes 0.113 (0.001) -0.607 (0.003) 0.056 (0.004) (5) -0.140 (0.009) 0.031 (0.001) yes 0.113 (0.001) -0.607 (0.003) 0.056 (0.004) 0.008 (0.0003) ??? 211,732 191,064 ??? 167,370 0.0016 ??? 0.2100 ??? 0.2119 Note: Education is measured as years of education completed; experience is measured as the individual's age minus education minus six.
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a By using a straightforward regression model we may estimate the wage gap between Canadians who are immigrants and those who are nativeborn even without adjusting for any other variables ln 0 1 Immig... View the full answer
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