Description

Many countries have an immigration system that prefers immigrants with needed skills, wealth, or higher education.  Do recent immigrants actually have better labor market outcomes (such as lower unemployment) if they have more education?  Do they have better outcomes compared to citizens with similar education?  After completing this assignment, you will be able to, with some time and patience, compare the labor market situations of citizens and noncitizens to see if recent immigrants have higher or lower unemployment than citizens depending on their education level.

You have data about individuals from the January 2019 Current Population Survey that includes the following variables:

Variable in Data Variable Description

gestfips State code:  indicates which state people live in

prtage Age of individual

peeduca Highest level of schooling achieved

prcitshp Citizenship status

prempnot Labor force status (employed, unemployed, not in labor force).  

pwcmpwgt Weight used to create official BLS labor market statistics.  NOTE:  THERE ARE NO IMPLIED DECIMAL PLACES IN THIS WEIGHT, SO YOU DON’T NEED TO TRANSFORM IT TO THE TRUE WEIGHT.

You will need the following data dictionary to determine what some of the values for the above variables (such as the citizenship status and the labor force status variable) mean:

http://www.nber.org/cps-basic/January_2015_Record_Layout.txt

For this assignment, you’ll need to turn in the R script or Excel sheet used in the calculations and provide the final calculation values for parts b-i:

Please compute the following dummy variables:

Adult:  1 if someone is 16 years or older, 0 otherwise

Noncitizen:  1 if someone is not a citizen, 0 otherwise

Citizen:  1 if someone is a citizen (even if he or she was originally born in another country), 0 otherwise 

Employed:  1 if someone is employed, 0 otherwise

Unemployed:  1 if someone is unemployed, 0 otherwise

College:  1 if someone has a 4 year college degree (bachelors) or higher degree, 0 otherwise

NoDegree:  1 if someone does not have a high school degree or GED, 0 otherwise. 

When creating these dummy variables, be careful not to have the dummy be 1 for observations where the variable is -1 in the data since -1 represents a nonresponse.

For parts b-e, consider using the dummy variables from part a to select the relevant population of employed and unemployed people in each group.  Then, use the dummies and the weight to count up the number of employed and unemployed in each group.   (10 points)

Please compute the unemployment rate for the citizen population who has at least a college degree.  (10 points)

Please compute the unemployment rate for the noncitizen population who has at least a college degree.  Is this unemployment rate for noncitizens higher or lower than that for citizens?  (13 points)

Instruction Files