published as 'The Effect of Deficiency at English on Female Immigrants' Wage in the UK: Correcting for measurement error, endogenous treatment, and sample selection bias' in: Applied Economics Letters, 2021, 28 (5), 349-353
We investigate the extent to which deficiency at English as measured by English as Additional Language (EAL), contribute to the immigrant-native wage gap for female employees in the UK, controlling for covariates. To deal with the endogeneity of EAL and a substantial problem of self-selection into employment we suggest a 3-step estimator (TSE). The properties of this estimator are investigated in a Monte Carlo simulation study and we show evidence that TSE delivers a consistent and asymptotically normal estimator. We find a large and statistically significant causal effect of EAL on the immigrant-native wage gap for women.
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