The Impact of Social Capital on The Earnings of Puerto Rican Migrants

Abstract

There is a paucity of studies examining the relationship between Puerto Ricans' social capital and their earnings. I utilized data from the Latin American Migration Project (collected in 1998 and 1999) to test five hypotheses derived from social capital theory to predict the hourly earnings of Puerto Rican migrants. My study illustrates that Puerto Rican migrants' social capital is positively related with their earnings. Interestingly, the social capital effects only pertain to Puerto Rican females. Additionally, Puerto Rican migrants do not benefit from ethnic solidarity in terms of increased wages. My analyses point toward social capital's ability to provide important labor market information to Puerto Rican females, which they appear to use to acquire jobs paying higher wages.Social capital theory has been applied to many different phenomenon including banking, education, immigration, labor markets, and nation building (Massey et al. 1987; Coleman 1988; Uzzi 1999; Fernandez, Castilla, and Moore 2000; Putnam 2000). Within the labor market, social capital has been found to be related with earnings, employment, formal employment, and job tenure (Mier and Giloth 1986; Donato, Durand, and Massey 1992; Aguilera 1999; 2003; Philips and Massey 1999; Aguilera and Massey 2003). Within the immigration field, social capital has been linked with the migration process, labor market outcomes, and attainment of citizenship (Massey et al. 1987; Baker 2000; Aguilera and Massey 2003; Fussell 2004). Unfortunately, Puerto Ricans have been unstudied within this massive literature about social capital. Additionally, gender differences in returns to social capital are only just beginning to be recognized and there is little agreement as to whether males or females benefit most from social capital. I studied the relationship between social capital and labor market outcomes of Puerto Rican migrants, paying special attention to differences in gender.