No Entiendo: The Effects of Bilingualism on Hispanic Earnings
No Entiendo: The Effects of Bilingualism on Hispanic Earnings
by Rodolfo De la Garza, Jeronimo Cortina (Political Science) , and Pablo Pinto
This paper examines the economic consequences of bilingualism. Specifically, we explore
whether the ability to effectively communicate in English and Spanish is rewarded in labor
markets. Using a sample of the Hispanic population drawn from U.S. census data for the
year 2000 we find that controlling for education, gender, age, place of birth, sector and
region of employment, earnings are higher as the ability to speak English increases. This
finding is in line with traditional theories of assimilation in labor markets. We also find that
bilingualism, namely the ability of speaking English and Spanish, is associated with higher
wages reversing the negative effect found in earlier studies. The reversal could be explained
by two trends associated with higher demand for bilingual individuals in labor market:
changing demographics resulting from increasing immigration from the South, and from
economic integration with Spanish speaking Latin America in the 1990s. The estimated
effect is, however, substantively small. Our results also show that bilingualism is negatively
correlated with wage-based income among different occupational categories and sectors, but
particularly among managers and those employed in the public sector.
