Information Asymmetry, Education Signals and the Case of Ethnic and Native Germans
CESifo, Munich, 2009
CESifo Working Paper No. 2683
![](https://cesifo.org/DocImg/cesifo1_wp2683.jpg?c=1689237162)
This paper analyses the effects of education signals for Ethnic Germans and Germans without a migration background (“Native Germans”). We base our analysis on a sorting model with productivity enhancing effects of education. We compare whether the signalling value differs between the migrants and non-migrants in the German labour market. Starting from the theoretical result that only a separating equilibrium can exist, we find substantial empirical differences between Ethnic and Native Germans with the same formal education level. This empirical analysis is done with a completely new dataset based on administrative data from the German Federal Employment Agency.
Labour Markets