DP963 The Economic Performance of Germany's East European Immigrants

Author(s): Christoph M Schmidt
Publication Date: May 1994
Keyword(s): Assimilation, Expellees, Germany, Migration, Refugees, Segmented Labour Markets
JEL(s): J15, J24, J31, J61
Programme Areas: Human Resources
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=963

Germany has experienced a substantial influx of German immigrants from Eastern Europe after World War II and expects several million more as a consequence of the demise of socialism. This paper analyses the economic performance of ethnic German migrants to West Germany in comparison with native born West Germans. Ethnic German immigrants from Eastern Europe display lower levels of education, lower rates of self-employment and higher unemployment rates than natives and immigrants from East Germany. Similar to foreign guest-workers, German immigrants are more likely to work in blue collar jobs; they do, however, eventually reach earnings parity with native Germans. This study therefore demonstrates, in contrast to analyses of the economic performance of guest-workers, that despite substantial persistence in economic stature, the German economy does not exclude immigrants from economic prosperity.