Multi-generation model of immigrant earnings: theory and application

This paper presents a three-generation migrant analysis, comparing the relative economic performance of various migrant generations to the native population. We develop a theoretical model to explain the relationship between the different earnings of the migrants over three generations and relate the model to the results in the literature. The empirical analysis explores the suitability of the theoretical implications based on data from the 1995 Israeli Census. We show that assimilation of the third generation into the local population is far from clear.