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The Effects of Human Capital and Social Capital on Immigrant Wages and Labor Market Incorporation in the United States and Japan
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The Differential Effects of Human Capital and Social Capital on Foreign Workers’ Wages in
the United States and Japan
By
Takeyuki Tsuda, Associate Director, Center for Comparative Immigration Studies
University of California, San Diego
La Jolla, CA 92093-0510
## email not listed ##
Wayne Cornelius, Director, Center for Comparative Immigration Studies
University of California, San Diego
La Jolla, CA 92093-0510
## email not listed ##
Zulema Valdez, Visiting Research Fellow, Center for Comparative Immigration Studies
University of California, San Diego
La Jolla, CA 92093-0510
## email not listed ##
Abstract
A common model of labor market incorporation among immigrants in the United States analyzesearnings as a function of standard human capital variables, such as age, education, languagecompetence, and employment experience in the host society. Yet, whether this model is applicablein other countries, where immigrants encounter different labor market conditions, is unclear.Drawing on data from a comparative study of immigrant labor in the United States and Japan, thispaper estimates multivariate models of wage determination among samples of foreign workers inSan Diego County, United States and Hamamatsu, Japan. In addition to the usual human capitalvariables, our models also incorporate social capital variables. Social capital variables are rarelyintroduced in US wage determination arguments; however, such variables may contribute toearnings in the US and may also prove important abroad. Findings reveal important variations in theexplanatory power of individual-level, human capital and group-level, social capital from onenational context to the other. In San Diego, human capital variables have a greater effect on foreignworkers’ wages, while social capital variables do not. In contrast, social capital significantlyincreases workers’ wages in Hamamatsu, while human capital does not. The paper draws on datafrom ethnographic studies in Japan and the USto suggest explanations for these divergent results .More generally, the paper illustrates the importance of a comparative framework that considers thecontext of reception (host societies) in determining labor market outcomes for immigrant workers.
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| | Authors: Tsuda, Takeyuki., Cornelius, Wayne. and Valdez, Zulema. |
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The Differential Effects of Human Capital and Social Capital on Foreign Workers’ Wages in
the United States and Japan
By
Takeyuki Tsuda, Associate Director, Center for Comparative Immigration Studies
University of California, San Diego
La Jolla, CA 92093-0510
## email not listed ##
Wayne Cornelius, Director, Center for Comparative Immigration Studies
University of California, San Diego
La Jolla, CA 92093-0510
## email not listed ##
Zulema Valdez, Visiting Research Fellow, Center for Comparative Immigration Studies
University of California, San Diego
La Jolla, CA 92093-0510
## email not listed ##
Abstract
A common model of labor market incorporation among immigrants in the United States analyzes
earnings as a function of standard human capital variables, such as age, education, language
competence, and employment experience in the host society. Yet, whether this model is applicable
in other countries, where immigrants encounter different labor market conditions, is unclear.
Drawing on data from a comparative study of immigrant labor in the United States and Japan, this
paper estimates multivariate models of wage determination among samples of foreign workers in
San Diego County, United States and Hamamatsu, Japan. In addition to the usual human capital
variables, our models also incorporate social capital variables. Social capital variables are rarely
introduced in US wage determination arguments; however, such variables may contribute to
earnings in the US and may also prove important abroad. Findings reveal important variations in the
explanatory power of individual-level, human capital and group-level, social capital from one
national context to the other. In San Diego, human capital variables have a greater effect on foreign
workers’ wages, while social capital variables do not. In contrast, social capital significantly
increases workers’ wages in Hamamatsu, while human capital does not. The paper draws on data
from ethnographic studies in Japan and the USto suggest explanations for these divergent results .
More generally, the paper illustrates the importance of a comparative framework that considers the
context of reception (host societies) in determining labor market outcomes for immigrant workers.
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