Immigrants’ Over-Education, their Labour Market Outcomes and Remittance Behaviour

The thesis investigates immigrants’ labour market performance and migrants’ remittance behaviour using survey data from Spain and Australia. Using empirical estimation techniques, it examines the following three aspects: (1) the impact of immigrants’ educational mismatch at home on the incidence and wage effects of over-education in the destination country; (2) the extent to which immigrants’ social and ethnic capital can correct over-education; and (3) the role of initial motives to migrate, employment conditions and education on immigrants’ remittance behaviour. Using individual data from Spain, the empirical results show that immigrants’ education-occupation mismatch can largely be explained by an existing education-occupation mismatch in the last job held in the home country. In addition to this, a high persistence in over-education is observed throughout their stay in the destination country, with significant wage penalties, especially for the higher educated group. It is argued that immigrants’ performance in the labour market can be improved by their social capital as it provides access to useful resources that could help them in finding a job. However, this does not necessarily mean that social capital can help in finding a better matched job over time. Using a longitudinal household panel survey from Australia, the results suggest that social capital does not contribute in reducing over-education. In particular, social participation and ethnic networks are strong contributors in accentuating over-education. Mixed results are found when distinguishing between levels of education, with the higher educated being better off in the labour market through their contacts. In addition to this, initial motives to migrate, labour market conditions in the host country as well as human capital accumulated may in fact have an impact on immigrants’ decision to stay in the host country, which could in turn affect their remittance behaviour. Evidence from Spain shows that labour migrants are more likely to send money back home, while family migrants have a lower propensity to remit. In addition, employment stability throughout the stay in the host country has a strong negative impact on both, the decision and the amount sent. Significant differences are observed between years of arrival, where the higher educated remit more as time spent in the host country increases, while level of income and employment stability appear to be important determinants for recent arrivals than for those who spent more than 10 years abroad.