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See detailForeign Workers and the Wage Distribution: What Does the Influence Function Reveal?
Choe, Chung; Van Kerm, Philippe UL

in Econometrics (2018), 6(3),

This paper draws upon influence function regression methods to determine where foreign workers stand in the distribution of private sector wages in Luxembourg, and assess whether and how much their wages ... [more ▼]

This paper draws upon influence function regression methods to determine where foreign workers stand in the distribution of private sector wages in Luxembourg, and assess whether and how much their wages contribute to wage inequality. This is quantified by measuring the effect that a marginal increase in the proportion of foreign workers—foreign residents or cross-border workers—would have on selected quantiles and measures of inequality. Analysis of the 2006 Structure of Earnings Survey reveals that foreign workers have generally lower wages than natives and therefore tend to haul the overall wage distribution downwards. Yet, their influence on wage inequality reveals small and negative. All impacts are further muted when accounting for human capital and, especially, job characteristics. Not observing any large positive inequality contribution on the Luxembourg labour market is a striking result given the sheer size of the foreign workforce and its polarization at both ends of the skill distribution. [less ▲]

Detailed reference viewed: 54 (6 UL)
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See detailDecomposing quantile wage gaps: a conditional likelihood approach
Van Kerm, Philippe UL; Choe, Chung; Yu, Seunghee

in Journal of the Royal Statistical Society. Series C Applied Statistics (2016), 65(4), 507-527

The paper develops a parametric variant of the Machado–Mata simulation methodology to examine quantile wage differences between groups of workers, with an application to the wage gap between native and ... [more ▼]

The paper develops a parametric variant of the Machado–Mata simulation methodology to examine quantile wage differences between groups of workers, with an application to the wage gap between native and foreign workers in Luxembourg. Relying on conditional-likelihood-based ‘parametric quantile regression’ in place of the standard linear quantile regression is parsimonious and cuts computing time drastically with no loss in the accuracy of marginal quantile simulations in our application. We find that the native worker advantage is a concave function of quantile: the advantage is small (possibly negative) for both low and high quantiles, but it is large for the middle half of the quantile range (between the 20th and 70th native wage percentiles). [less ▲]

Detailed reference viewed: 59 (5 UL)