Measuring and Mismeasuring Discrimination against Visible Minority Immigrants: The Role of Work Experience

Abstract

There are two methods for estimating the earnings disadvantage of groups: the residual difference method and the Oaxaca-Blinder decomposition. Each method infers disadvantage from differences in earnings of visible minority immigrants and other Canadians, after controls for human capital and job characteristics. We: i) summarize the logic of these methods; ii) critically examine the character of the experience measures used in most of the research; iii) apply the residual difference method to the Workplace and Employee Survey to show how a more thorough approach to the measurement of work experience modifies estimates of earnings disadvantage.