Native language and immigrant labour market outcomes: An alternative approach to measuring the returns for language skills

In contrast with the conventional approach of studying the interrelation between immigrants' language skills and their chances of succeeding in the host country labour market, this article explores the relevance of having and not having a mother tongue in common with the native population for otherwise similar immigrants. This is accomplished by using linked register data from two countries, which makes it possible to separate people according to their native language. We find that immigrants who have their mother tongue in common with natives have substantially higher employment and income levels than immigrants who originate from the same country, but whose native language is linguistically different from the dominant language of the host country. The results support the view that language is a fundamental part of immigrants' human capital and thus promotes their labour market outcomes. © Springer Science+Business Media B.V. 2007.