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A large literature examines the occupational mobility of immigrants and the potential underuse of their human capital in destination countries. Immigrants typically experience a U-shape pattern of occupational change, from their last job in the origin country to their first and then subsequent jobs in the destination country. Many never re-attain the same occupational status of their last job in the origin country. Yet such studies may understate the occupational cost of migrating since the last job in the origin country is not the correct counterfactual; immigrants may have experienced occupational change even if they had never migrated. In this paper, we use a migration lottery to see if bias results from use of this counterfactual. A unique longitudinal survey designed by the authors compares occupational change for migrants who enter New Zealand through a random ballot with occupational change for similar workers in the home country of Tonga who were unsuccessful participants in the same ballots. (Joint work with David McKenzie and Steven Stillman)
On Friday, January 8, 2010, Center for Global Development hosted a brownbag seminar on Is the Occupational Cost of Migration Understated? Evidence from a Migration Lottery featuring John Gibson, University of Waikato and Center for Global Development.