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Applied Economics
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The earnings of Canadian immigrant and native-born

males
a
Ronald Meng
a
Department of Economics , Brock University , St. Catharines, Ontario, L2S 3A1, Canada
Published online: 28 Jul 2006.

To cite this article: Ronald Meng (1987) The earnings of Canadian immigrant and native-born males, Applied Economics, 19:8,
1107-1119, DOI: 10.1080/00036848700000051

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 Applied Economics, 1987, 19, 1107-1 119

The earnings of Canadian immigrant and

native-born males
RONALD M E N G
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Department of Economics. Brock University, St. Catharines. Ontario L2S 3A1, Canada

This paper examines the economic attainment of Canadian immigrants. Although foreign-born
males initially earn less than the native-born, their earnings rise more rapidly with Canadian
labour market experience, and after 14 years their earnings equal and exceed those of the native
population. It is also shown that the use of Mincer's identity leads to biased results when
estimating the earnings of the immigrant population.

I. INTRODUCTION

Recently, there has been growing interest in the economic attainment of immigrants (Chiswick,
1977, 1978a, 1978b, 1980; Carliner 1980; Borjas, 1982; Long, 1980; Meng, 1986; Meng and
Sentance, 1986). In 1981,census figures report that the foreign-born population in Canada was
3.84 million, or 16 % of the population. In 1980, the average, adult male native had earnings of
$16600. The figure for adult male immigrants was $18500. This represents an earnings
advantage for immigrants of over l l % (Statistics Canada, 1984).
To date, there have been few systematicattempts in Canada to examine explicitly the effects of
foreign birth, length of time spent in Canada and their relationship to the earnings of native
Canadians.' This paper has two principal objectives. The first is to fill this gap by examining the
earnings of immigrants and non-immigrants alike using a model which incorporates a number
of family background variables in the analysis. The second objective is to examine the effect of
the specification error found in hisw wick's (1977, 1978b, 1980) work.
In the analysis of Mincer's identity, this paper shows that the now commonly accepted
definition for labour market experience (Age - Education - 5 = T) underestimates the returns
to work experience for foreign-born males. The appropriate measure (actualexperience)yields a
much higher coefficient than does T. Also when using Mincer's approach, the returns to

'Tandon (1977), in a more limited study, does examine the earnings of immigrants and non-immigrants in
Ontario. However,he infers the years of labour market experience and had to assign as year of immigration
the mid-point of a several year period in which immigration took place. He also excludes the self-employed,
people living in rural areas, and only controls for a limited number of explanatory variables. Sociological
studies have been carried out by Kalback and McVey (1979) and Richmond and Kalback (1980). These
latter studies tend to be descriptive and they avoid using a theoretical model.
+
0003-6846187 $03.00 . l 2 0 1987 Chapman and Hall Ltd. 1107
 1108 R. Meng

immigrants' (potential) experience is less than that for native Canadians, a result similar to
Chiswick (1978b),using US data. However, when the actual measure of experience is used the
returns to labour market experience are higher for immigrants than for native Canadians.

11. ESTIMATING P R O C E D U R E S A N D HYPOTHESES

The human capital earnings function is the basis for this study. The form used is essentially that
developed by Chiswick (1978b) for his study on the Americanization of immigrants. For the
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native-born, human capital investments are measured to have been made in Canada. The native-
born earnings function can be written as:
N
In EARNj = /3, + B, EDUCj + B, EXPj + /l3EXPf + C PiXij+ Uj (1)
i=4

In Equation 1, EARNj is the annual income from employment for the jth person, EDUCj is
years of schooling, EXPj is years of experience in the labour market, the Xijsare a series of other
explanatory variables, Uj is the error term and /l0 is the ~ o n s t a n tThe
. ~ error term is assumed to
be randomly distributed with a mean of zero.
The foreign-born may have engaged in schooling either before (EDUCb)or after immigration
(EDUC,); they may also have worked prior to (EXPb)or after (EXP,) immigration. Country-
specific aspects of human capital raise the possibility that experience and schooling prior to
immigration may have a weaker effect on earnings than that acquired after immigration.
Employers, for instance, may have less information about foreign human capital and hence
discriminate against it. The foreign-born earnings function is approximated to be:

Since EDUCj = EDUCb, + EDUC,, and EXPj = EXPb, + EXP,,, Equation 2 can be written
as:3

The exogenous variables are listed in Table 1. The human capital earnings equation (Mincer,
1974) is adopted, with schooling, experience and its square as major explanatory variables.

2 A year of experience is defined as working on a full-time basis (i.e. at least 35 hours a week) for seven
months in a given calender year.
'After estimating Equation 3, it was found that the coefficient for EDUC, is insignificant at the 10%level
(t = 1.634). The coefficient for EXP, X EXPaj, however, is highly significant, taking on a value of
0.00461 (t = 3.842). On this basis, the latter term is included in the analysis where appropriate.
 Table 1. Variables

Variable Description
p--

In EARN Natural log of income from employment, 1972

EDUC Number of years in school
FORED Number of years in school if individual is foreign-born
EXP Number of years worked
YRIC Years in Canada
EEA Number of years worked X years in Canada
EXP~ Number of years worked squared
YRIC~ Years in Canada squared
Natural log of weeks worked, 1972
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In W K S
DC* University degree
APR* Apprenticeship or training programme completed
SELF* Self-employed
FTIME* Employed full-time
BREAK* Did not work for a period of at least one year after first full-time job.
NPERUN Number of periods of3 months or more of unemployment since first full-
time job
A TL* Atlantic provinces (reference group)
QUE* Quebec
ONT* Ontario
PRA* Prairie provinces
BC* British Columbia
URBAN l* Large urban centre (population >, 100000- reference group)
URBAN2* Other city (pop. 5000-100000)
URBAN3* Small urban centre (pop. 1000-5000)
URBAN4* Rural area (farm and non-farm)
LANGI * English and other language (not French)
LANG2* French or other language (not English - reference group)
LANG3* Bilingual (English and French) and other language
LAF l l * English first language spoken (reference group)
LAF 12* French first language spoken
LAF 13* Other first language spoken
MAR* Married (spouse present)
CHILD Number of children ever born
BRSI Number of brothers and sisters
RELl* Jewish
REL2* Protestant (Anglican, United Church, Presbyterian, Dutch Reform,
Lutheran)
REL3* Other religion
REU* Roman Catholic (reference group)
RELS* No religion
NOTLI * Mother or other female head of household when individual was 16
MWORKI* Mother worked less than one year while individual at shoo1 age
MWORK2* Mother worked 1 to 5 years
MWORK3* Mother worked more than 6 years
MWORK4* Mother did not work (reference group)
FAOC Blishen index for father's occupation when respondent was 16
FEAGE Father's years of education X own age
MEAGE Mother's years of education X own age
FOR* Born outside Canada
*Indicates dummy variable = 1 if condition satisfied.
 1110 R. Meng

Following Mincer and others weeks worked and weekly hours are controlled for. These
variables are augmented by measures in fluency of Canada's official languages.
Since the cost of living is known to vary between urban and rural areas and between provinces
a series of dummy variables are included to control for these factors. In addition, it is often
observed that marriage and number of children influence males' commitments to the labour
market and their earnings. Variables are introduced for these factors.
Also included in the analysis are a series of socio-economic background variables. The
intergenerational transmission of values and social status has been well documented elsewhere
(Bowles, 1972). Finally, two credential or signalling variables (DC and APR), two continuity of
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work experience variables (BREAK and NPERUN) and a self-employment variable are
included in the regressions.
Several hypotheses regarding the earnings of foreign-born males have been advanced and
tested in previous work. These will be considered here where the data permit. In addition,
differences resulting from the different data sets used are compared.
Since some of the hypotheses listed below have been discussed elsewhere, these will be dealt
with briefly.
(1) The first hypothesis deals with the possible earnings disadvantage immigrants may face as
they enter the ~ o u n t r ySince
. ~ many immigrants have different customs and language skills
they are likely to start at a lower wage rate than those already residing in the country.
(2) The initial wage gap, which is largely related to the differences mentioned above, should
diminish with more time spent in Canada as the immigrant learns the dominant language,
acquires information about the labour market and generally adjusts to Canadian society.
(3) The number of years since migration should be less significant for explaining earnings for
immigrants from countries that are more similar to Canada in terms of language, educational
institutions and culture than those migrants from more culturally diverse nations.
(4) To the extent that some schooling may be country-specific, it is possible that such training
will yield a lower return for immigrants.'
(5) As with schooling, training received in work prior to immigration may also be country-
specific.
(6) Employers are often unable to judge the productivity of,new Canadians due to lack of
information about the immigrant's homeland, inability to check work references and lack of
knowledge of foreign schooling. One way for immigrants to signal that they are productive
workers is to acquire a degree or a training certificate (DC, APR). This implies that the returns
to a degree or apprenticeship programme should be higher for the foreign-born than the
native-born.
(7) If immigrants do start at an earnings disadvantage but their incomes rise faster than those
of natives, earnings profiles of immigrants are likely to be steepest in the first few years in the
country. Immigrants have an incentive to invest in on-the-job training, increase their
4The extent to which the wage gap shrinks with time spent in Canada will, in part, be influenced by a
number of factors which cannot be controlled for. The most notable of these is racial or cultural
discrimination. If discrimination against some immigrants exists, the wage gap will close less rapidly than it
would in the absence of discrimination.
Not only are there likely to be differences between rates of return for education for the two groups, but the
rate of return for EDUC, and EDUC, may also differ (cf. footnote 14).
 The earnings of Canadian immigrant and native-born males 1111
knowledge about the labour market and learn English (or French) immediately about
migrating to Canada.6
Racial discrimination is prevalent in all societies. Within the context of the present study this
implies that the market earnings of immigrants, especially those not from Europe or the United
States, will be adversely affected. With discrimination,the earnings of non-whites will be lower
than they normally would be in the absence of discrimination. This is true despite the fact that
non-European and non-American immigrants' yearly earnings exceed native-born earnings by
3.5 % (cf. footnote 16 and Table Al). The former are also more educated than the native-born
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population.
It should be pointed out, however, that the question of discrimination cuts across both
populations being studied here. There is no reason to believe that immigrants from the
Caribbean, for instance, would be more or less adversely affected by discrimination than native
black Canadians. Discrimination will most likely exist within both groups.
The data base used in this study is the Canadian National Mobility Survey (1973): It is a micro
data set containing observations on over 44 000 individuals eighteen years of age and over who
were not full-time students in March 1973.8The sample is a group of males, aged 22 to 64, who
had positive weeks worked and income earned in 1972.'
Ideally, if one were to analyse the economic progress of immigrants, panel data should be
used. Unfortunately, such data do not exist in Canada. This study is limited in that it is using a
cross-sectional survey, The principle limitation is that it is impossible to tell what happens to
specific individuals as they move through the labour market over time.

111. T H E EARNINGS O F NATIVE AND FOREIGN-BORN

CANADIANS

The foreign-born men in the sample earn more than the native-born by about 14% (see Table
Al). The earnings advantage of the foreign-born is reduced substantially when differences
between native and foreign-born are controlled for. The regression reported in the first column
of Table 2 includes a dummy variable for foreign birth (FOR), which indicates 3.51 %
disadvantage to foreign birth.'O."
6For a more detailed description of the hypotheses see Chiswick (1979).
Use requires acknowledgementof the investigators responsible- M. Boyd, H. A. McRoberts and J. Porter
of Carleton University; F. Jones and P. C. Pineo of McMaster University; and J. Goyder, University of
Waterloo-as well as the Canada Council and Statistics Canada.
Given the superior variables outlined above it was felt that even though the latest Canadian Census was in
1981 it was best to use the Canadian National Mobility Survey data base in this paper.
'The estimate may be biased due to censoring those individuals who are unemployed for the entire year. If
immigrant status is a source of market disadvantage, then immigrants are more likely to be affected.
However, the exclusion of the unemployed is standard in such human capital earnings functions. The
natural logarithm of weeks worked in 1972 is included as an independent variable. Inclusion of the
unemployed would only bias the results even further. See Chiswick (1983) for a discussion of using such a
variable.
10Inclusion of the FOR variable in Equation l in Table 2 yields an incremental F-statistic of 3.81. This is
just insignificant at the 5 % level (F,,,,, = 3.85). ~ d v i nfrom ~ equation 1 to Equation 2 yields
 11 12 R. Meng
Table 2. Pooled regression

Independent variables (1) (2) (3)

EDUC

EXP

EXP,

In W K S
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DC

FOR

YRIC ( F O R )

YRIC2 ( F O R )

EEA ( F O R )

FORED ( F O R )

Constant
R2
n

t-statistics are in parentheses.

*significant at 1 %, **significant at 5 %, ***significant at 10 %.
Also controlled for but not reported in these results are: APR, FTIME, SELF, BREAK,
NPERUN,QUE-BC, URBAN2-URBAN4, LANGl and LANG3, LAF 12and LAF 13, MAR,
CHILD, BRSI, REL1-REL3 and RELS, MWORKl-MWORK3, FAOC, NOTLI, FEAGE and
MEAGE.

The second and third columns of Table 2 show that the,inclusion of years in Canada
clarifies the relative earnings differences. The partial effect of foreign birth on earnings evaluated
at the mean of YRIC2 now indicates a 3.2 % advantage to foreign birth. The set of foreign birth
variables (FOR, YRIC, YRIC2, EEA) are all highly significant.
The earnings gap between the native and foreign-born does change over time. Controlling for
other impacts on earnings, the value for (8 In E l 8 FOR) after one year of immigration shows a
15 % disadvantage. The native-foreign gap is closed fairly quickly, falling to 10.2 % after 5 years,
4.3 % after 10 years, finally disappearing after 14 years. Thereafter, progress continues at a
slower pace, reaching a maximum of 14.6% at 45 years.12
F,,,,,, = 11.87, and from Equations 2 to 3 F,,,,,, = 11.54. Both are significant at the 1% level.
"Following Kennedy (1981),the marginal effect of the dummy variable is estimated to be exp (c - ) V ( c ) )
- 1, where c is the estimated coefficient for the variable and V ( c )is its variance.
"d In EJaFOR = - 0.184 + 0.0136 (YRIC)- 0.000336 (YRIC2)+ 0.000176 (EEA), where EEA = YRIC
X (YRIC+ 3.336). The marginal effect of the dummy variable is -0.169.
 The earnings of Canadian immigrant and native-born males 1113

Including the return to education (FORED) in the analysis drops the dummy variable for
foreign birth to an insignificant level. The return to education for immigrants for an additional
year of schooling is significantly lower than for the native-born (2.64 % versus 3.94%).
The separate regressions on native and foreign-born Canadians bring out some differences in
detail that are not clear in the pooled data.13 In Table 3 the foreign-born regressions indicate
that the partial effect of a year of schooling is only 2 %, somewhat less than the 2.6 % indicated by
the pooled ~arnple.'~ The difference is probably the result of a higher payoff to a degree for the
foreign-born which is not allowed for in the pooled sample.
The variation of earnings with years in Canada (YRIC) shows that the interaction term (EEA)
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is significant and positive. The coefficient apparently outweighs the negative effect of YRIC2,
such that earnings actually rise at a slightly increasing rate with years in Canada. The predicted
percentage increase in earnings (a In E) for different years of residence (YRIC) (assumingthat the
mean difference between YRIC and EXP of 3.336 exists on entry) is 1.0 after 1 year, 5.0 after 5
years, 10.1 at 10 years, 21.0 at 20 years, 32.5 at 30 years and 44.8 after 40 years.''
The specifications of the earnings functions found in Table 2 were modified to allow for
differences between native Canadians and immigrants from the United States and United
Kingdom, western Europe, southern Europe and the rest of the world.16 There is a marked
similarity between some of the groups. Those from the United States, the United Kingdom and
western Europe significantly diverge from the native reference group in terms of the foreign
birth variable and the foreign education variable. Years in Canada does not appear to influence
their incomes. Those from eastern Europe, southern Europe and other parts of the world display
similar patterns, with YRIC and YRICZ being highly significant, and the FOR and FORED

"A Chow test was conducted to determine if the individual regressions were substantially different from
each other. The critical F-statistic at the 1% level (F:,,,,,, = 1.59) is significantly less than the F-statistic
produced by the Chow test ( F = 3.08).
14FollowingChiswick (1978b) EDUC, and EDUCb for the foreign-born are approximated excluding the
interaction terms found in Equation 3. The rate of return for an additional year of education prior to
immigration is 1.67 %(t = 3.243) and the rate of return after immigration is 1.45 % (t = 2.710). The results
indicate that there is no significant difference between EDUC, and EDUCb.
lSThetheory of migration (Chiswick, 1979) predicts that immigrants have less job-specific human capital
than native workers. This result occurs because job-specific skills are not easily transportable between
countries. Given the greater number of degrees (15.6% to 10.5%) and apprenticeship and training
programmes completed (32.3 % to 25.5%) for the foreign-born, their human capital does appear more
general and less job-specific than the Canadian born males'.
16Theplace of birth means are:

USA,UK Western Eastern Southern Rest of

Europe Europe Europe world
EXP 23.211 21.111 24.280 18.074 14.956
EDUC 12.825 11.639 10.800 7.296 13.000
DG 21.2 % 11.1% 12.0 % 1.5 % 30.4 %
YRIC 20.1% 18.175 23.024 13.368 9.491
EARN 9330 8734 7951 7998 7739
n 414 262 197 182 167
 1114 R. Meng
variables are insignificant." Based on these results the immigrant population has been split into
two groups, those from United States, United Kingdom and western Europe (UUWE) and
those frose from eastern Europe, southern Europe and other (EESEOT).
The UUWE group earns considerably more ($9097) than the EESEOT group ($7903) or the
native group ($7480). These earnings differences may be a result of labour market discrimination
or different levels of human capital investments, or a combination of both factors. The UUWE
group have on average over three years more experience, nearly four more years in Canada, and
appear to be more highly qualified than the EESEOT group. The latter, especially those of non-
European origin, are more likely to face discrimination in hiring and in their wage levels than
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other immigrants.
The regression results for the two groups are reported in Table 3. In terms of the returns to
education, experience, years in Canada and the interaction between these, the place of birth does
seem to make some difference. The UUWE group have a lower return to education, a degree,
training programmes and years in Canada than do the EESEOT group. With greater
investments in human capital the UUWE group should, ceteris paribus, receive lower returns for
their investments than the EESEOT group, providing each population has approximately the
same level of ability.''

IV. E S T I M A T E S U S I N G M I N C E R ' S I D E N T I T Y

If there are various interruptions in one's working life they will not be accounted for when using
Mincer's T. Of all native Canadians 11.5% have had at least a one year break in their working
lives. The figure for the foreign-born is 14.2 X. The average age for the native is 39.69 years, and
for immigrants it is 41.49 years. Given the educational means, Tfor the native is 23.46 years; Tfor

"Table 2 regressions were redone to allow for country of origin differences, with the following results:

Origin FORED YRIC YRIC* FOR

USA and UK -0.0258*
(2.674)
Western Europe - 0.0295*
(2.744)
Eastern Europe -0.0181
(1.632)
Southern Europe -0.00862
(0.775)
Rest of world -0.00432
(0.351)

l 8 It is possible the market discrimination may deter immigrants from Eastern Europe, Southern Europe
and the rest of the world from investing in further human capital. However, it is unlikely that this is the case
because the Rest of world group has a greater level of education and number of degrees than anyone else in
theimmigrant population. It is thisgroup that is most likely to facegreater market discriminationthan any
other, having fewer years in Canada and less experience than other immigrants. Both factors positively
contribute to earnings.
 The earnings of Canadian immigrant and native-born males
Table 3. Separate regression

Variables Native Foreign-born UUWE EESEOT

EDUC 0.0410* 0.0195* 0.0184* 0.0271*
(15.018) (4.079) (2.722) (3.0722)
EXP 0.033 1* 0.0387* 0.0372* 0.0366*
(16.305) (8.341) (6.098) (4.952)
EXPZ -O.O00639* -0.00095* -0.00089 1* -0.000926*
(15.975) (9.500) (6.854) (5.786)
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In W K S 0.661* 0.717* 0.895* 0.608*

(33.317) (16.894) (14.371) (9.871)
DG 0.21 l* 0.293* 0.229* 0.409*
(8.301) (6.066) (3.801) (4.983)
YRZC 0.00848* -0.00104 0.02 108*
(2.609) (0.265) (3.641)
YRICz -0.000353* -0.000229* - 0.000535*
(5.043) (2.863) (3.344)
EEA 0.000389* 0.000407* 0.000333
(3.536) (3.131) (1.45)
BREAK -0.0951 * -0.158* -0.105** -0.213*
(4.830) (4.133) (1.998) (3.804)
NPERUN -0.0063 1* 0.000832 -0.00199 0.00375
(3.525) (0.171) (0.3 15) (0.496)
APR 0.0795* 0.0763* 0.0273 0.1324*
(5.699) (2.601) (0.772) (2.601)
MAR 0.146s -0.00839 0.151*** -0.2568**
(5.0222) (0.1 15) (1.773) (2.005)
CHILD 0.0149* 0.00893 0.0201*** 0.00637
(4.257) (1.024) (1.877) (0.455)
FAOC 0.00198* 0.00 129 0.00219 -0.00076
(3.600) (1.132) (1.599) (0.400)
Constant 5.202 5.23 1 4.255 ' 5.822
KZ 0.47 0.42 0.46 0.40
n 6054 1222 674 548

Also controlled for but not shown here are: FTIME, SELF, LANGI-LANG2, QUE-BC,
U R B A N Z U R B A N 4 , LAF12-LAF13, REL1-REL3, REL5, BRSI, NOTLI, MWORK1-
M WORK3, FEAGE, MEAGE.

the foreign-born is 25.08 years. The gap between potential and actual experience for the native-
born is 3.13 years. For the foreign-born the gap between potential and actual experience is even
bigger at 4.11 years. These sizeable differences cannot simply be ignored.
Since potential experience is a proxy for actual experience some of the previously cited
earnings functions were re-estimated using T instead of years worked. Table 4 presents the
results. Column 1 is the re-estimation of Equation 3. As previously stated, when using actual
 1116 R. Meng
Table 4. Estimate using Mincer's identity
(1) Foreign-born (2) Foreign-born (3) Native
Variables (Equation 3) (Table 3) (Table 3)
EDUC

EDUC,
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YRIC

EEA (YRIC x T)

In WKS

DG

Constant
R2
n

Controlled for but not shown here are: APR, FTIME, SELF, BREAK, NPERUN, QUE-BC,
URBAN2-URBAN4, LANGl and LANG3, LAF12, LAF13, MAR, CHILD, BRSI,
REL1-REL3 and RELS, MWORKl-MWORK3, FAOC, NOTLI, FEAGE and MEAGE.

experience the variable measuring post-immigration education (EDUC,) was insignificant.

When using Mincer's approach the same result holds. However, the interaction term (EXP
X YRIC) term was significant at the 1 % level. Now this term (YRIC X T)is insignificant, a result
similar to Chiswick's (1978b, p. 904, n. 12).
Column 2 reproduces the foreign-born regression found in Table 3, excluding the interaction
term. The return to the first year of work experience, using T, drops from 3.71 % to 2.83 %
assuming one year in Canada. This represents a drop of almost 1 % a year. Column 3 of Table 4
contains the estimates for the native-born using potential experience. In this case the rate of
return to the fist year of (potential) experience is 3.3 %, where previously it was 3.18 %. There is
little change in the two case^.'^ The coefficient for native potential experience, when controlling
for the other explanatory variables is now greater than foreign-born potential experience.
Previously, the return to foreign-born experience was greater than that of the native.
l9 Meng (1986)presents results for a model that includes only those variables found in Chiswick's (1978b)
seminal paper. The results indicate that the bias does not appear to be a result of the inclusion of additional
expanatory variables, but rather the use of Mincer's identity instead of experience.
 The earnings of Canadian immigrant and natiw-born males 1117
Why are there so many differences when comparing Mincer's T to actual experience? The
answer appears to be the large gaps between actual and potential experience. The foreign-born
appear to be more efficient in translating a given year of work experience into greater income
than the native-born. When using Mincer's identity, however, these efficiency differences
between the groups appear to be clouded. This is because within T, there are breaks in the
respondent's working life. The marginal return to this aggregate figure will fall for the group that
received greater returns for actual experience (i.e. the foreign-born),as well as the group that has
the biggest gap between EXPand T(a1so the foreign-born). The gap between actual experience
for both groups is only 0.64 years, with the foreign-born being greater. However, the gap
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between potential experience is 1.62 years, with the foreign-born still being greater. Using T
means that the variable and the estimated coefficient suffer from an error in variables problem.

IV. SUMMARY AND C O N C L U S I O N S

This paper analyses the earnings of foreign-born and native men in Canada. Some of the results
of this paper are consistent with equivalent American and Canadian studies. However, there are
enough differences to merit explicit mention.
Immigrants do start at an earnings disadvantage as they enter the country. The foreign-born
population has an earnings disadvantage of 15 % after one year. The initial wage gap, though,
does diminish with more time spent in Canada. After approximately 14 years, the crossover
point occurs and immigrants earn more than the native-born.
The number of years in Canada is significant in explaining earnings for immigrants from
eastern Europe, southern Europe and the rest of the world. It is less significant in determining
the incomes of those immigrants from the United States, the United Kingdom or western
Europe.
There is little evidence to indicate that there are country-specific aspects of schooling,
although the returns to education are lower for first generation Canadians. There may be aspects
of country-specificwork experience; however, given the data, it is not possible to guarantee this.
The coefficients for the experience variables (EXP, EXPZ)are larger in absolute terms for the
foreign-born. This could indicate a larger effect on earnings in Canada of labour market
experience prior to migration. Alternatively, this result could occur because they are more
motivated, or have greater innate abilities.
The credential effects are both significant in determining native and foreign-born earnings.
However, the marginal effect for the native and those born in the United States, United
Kingdom and western Europe is significantly less than those from the rest of the world.
The final hypothesis dealt with the pattern of income through time. It was hypothesized that
immigrants' earnings profiles should be steepest in the first few years in the country. When using
actual experience the earnings of immigrants rise at a slightly increasing rate. Therefore, no
evidence was found to indicate that the earnings profile is steepest in the first few years in
Canada.
 R. Meng
APPENDIX A

Table A l . Means

Variables Native Foreign-born UUWE EESEOT

In EARN
($1
EDUC
EXP
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In WKS
DG (%)
APR (%l
FTIME ( X )
BREAK ( X )
NPERUN
LANG1 ( X )
LANG2 ( X )
LANG3 (X)
MAR (%)
CHILD
YRIC
SELF (%l
ATL (%)
QUE (%)
ONT (%l
PRA (%l
BC (%l
URBAN1 ( X )
URBAN2 (%)
URBAN3 ( X )
URBAN4 ( X )
LAFll ( X )
LAFl2 (%)
LAF 13 (%)
REL1 ( %)
m L . 2 (%l
REL3 (%)
REL5 (%)
NOTLI (X)
MWORKl ( X )
M WORK2 (X)
MWORK3 ( X )
M WORK4 ( X )
FAOC
BRSI
FEAGE
MEAGE
 The earnings of Canadian immigrant and native-born males 1119

ACKNOWLEDGEMENTS

Thanks go t o Wendy Watkins and to Serge Buonocore for their research assistance. I a m also
indebted t o Felice Martinelio, Jim Sentance, Duog Smith a n d an anonymous referee for their
comments.

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