Labour Market and Human Capital Behaviour of Immigrant Couples: Evidence from Australia

Abstract

AbstractWe examine the labour market and human capital investment behaviour of immigrant couples in Australia. The family investment hypothesis (FIH) states that immigrant husbands, whom the FIH assumes to be the primary earners in the family, will invest more in their human capital than immigrant wives, whom the FIH assumes to be secondary earners. Using longitudinal data from Household, Income and Labour Dynamics in Australia (HILDA) for the period 2001 to 2014, we do not find support for the FIH. Instead, we find that foreign‐born husbands and wives share similar labour market assimilation patterns with respect to hours of work and wages. Our estimates suggest that immigrant wives' labour market behaviour can be better explained by their own long‐term career progression and labour market assimilation, than through supporting their husbands' labour market assimilation.