- This article was originally published in the June 2021 edition of the 5 papers…in 5 minutes.
With each subsequent migration wave in developed countries, the question of foreigners’ integration increasingly gains importance. It is known that the immigrant population largely suffers from high unemployment rates, poor economic situations, and face discrimination. This is problematic for migrants themselves and can, in addition, lead to hostility and foster anti-immigrant feelings among the native population. The successful integration of foreigners into the host societies is thus a crucial objective of policymakers. Lack of legal status tends to be a major barrier for the social, economic and political integration of foreigners. Hence, granting of the host country’s nationality can be a potential tool for integration. The fierce debate surrounding it is whether naturalization is only a reward for achieving integration, or whether it can in itself be a boost to integration.
In this article, Yajna Govind estimates the causal effect of naturalization on labor market outcomes. She exploits a national-level reform in the law of naturalization through marriage in France which occurred in 2006. The reform amended the eligibility criteria of applicants by increasing the required number of years of marital life from 2 to 4. De facto, this reform impacted foreigners that were married before and after 2004 differently, as the former could apply as early as within two years of marriage while the latter were constrained to wait four years of marriage. In other words, foreigners in two otherwise similar cohorts of marriage, expecting to naturalize within the same number of years, unexpectedly face different length of waiting time to be eligible to naturalize. Using a rich administrative French panel data, the Permanent Demographic Sample (EDP), the author first documents the differential propensity to be naturalized in the years following marriage between those facing a two-year waiting period (early-treated group) compared to those waiting four years (late-treated group). The author exploits this unexpected change in the eligibility rule, and the resulting impact on these two groups using a difference-in-differences approach by comparing their labour market before and after they are likely to be naturalized. The results suggest that naturalization is followed by an increase in net annual earnings, explained by an increase in the number of hours worked and hourly wages, with differences based on gender, age and professional categories. The author explores the underlying channels that could explain the benefits of naturalization. While unrestricted access to the labour market, as proxied by public sector employment, does not seem to have played a role, the results suggest that naturalization helps reducing discrimination and informality. The nationality of the host country seems to be used as a signaling device in the labour market for integration and language proficiency. Additionally, naturalization leads to higher declared number of hours worked in sectors that are highly impacted by informal employment.
In all, this study underlines the importance of naturalization for the economic integration of foreigners, with strong causal evidence. The author emphasizes that this debate on the benefits and disadvantages of restricting naturalization, being mostly a political one in nature, needs to better account for the fact that naturalization can in itself boost the economic integration of foreigners. Hence, if the aim of host countries is to better integrate foreigners, easier access to citizenship could potentially be a way to hasten the path to integration.
Original title of the article: Is naturalization a passport for better labor market integration? Evidence from a quasi-experimental setting
Published in: PSE working paper n°2021-42
Available at: https://hal-pse.archives-ouvertes.fr/halshs-03265055
This work has been awarded the Prize in memory of Maria Concetta Chiuri, Conférence SIEP, and the Best paper award 2021, Workshop on Labour Economics, IAAEU.
* PhD Student (PSE, EHESS)
This synthesis has been published in the June edition of “5 papers… in 5 minutes!” dedicated to PhD students work.
Credits : Shutterstock, Andrey_Popov