This paper reports on the development and preliminary analysis of a unique data file that includes matched employee-employer data for a sample of illegal aliens and parallel data on the establishment and workforce for employers randomly selected from industry directories. It is shown how these data can be used to address substantive issues regarding the labor market adjustment and impact of illegal aliens through 2 examples analyses of wages and on-the-job training. In addition to the myriad of specific conclusions that have been developed from the methodological and data analyses 2 general conclusions emerge from this project. 1 is that the methodology is successful for investigating the labor market adjustment and impact of illegal aliens. More generally it demonstrates the feasibility of developing employee-employer matched data files for other demographic groups or the labor force as a whole. The other is that the illegal alien labor market appears to be well-functioning; i.e. it is competitive fluid and flexible and provides opportunities for economic advancement and job mobility even for low-skilled foreign-born workers in this country illegally. (authors)

One of the standard propositions in the migration literature is that migrants tend to be favorably `self-selected for labor-market success. That is economic migrants are described as tending on average to be more able ambitious aggressive entrepreneurial or otherwise more favorably selected than similar individuals who choose to remain in their place of origin.... In recent years there have been challenges to the general proposition of the favorable selectivity of migrants. In addressing this issue this paper considers alternative specifications of the migration model that are relevant for the issue of migrant selectivity. (EXCERPT)

In 1970, 9.6 million persons in the United States, or 4.6 percent of the population, were foreign born. Another 24 million persons, or 11.5 percent of the population, were of foreign parentage, that is, either one or both parents were foreign born. The earnings and labor market behavior of the foreign stock (foreign born and foreign parentage) have not been the subject of much systematic research despite the rise in public interest in ethnicity and discrimination. This paper, which focuses on the foreign parentage, is drawn from a larger study of the earnings of the foreign stock which is intended to remedy this situation (see Chiswick). This paper examines the effect of foreign parentage on the earnings of native born white men age 25 to 64 who worked in 1969. It is restricted to whites as they comprise 97 percent of the persons of foreign parentage and to men because the problems of estimating labor market experience for women require that they be dealt with separately. In addition, persons born in Puerto Rico or an outlying area of the United States are excluded from the data.

In their article in this Review, W. Lee Hansen, Burton Weisbrod, and William Scanlon (HWS) conclude that estimated payoff to more schooling is for their sample of men who were rejected for military service due to low scores on the Armed Forces Qualification Test (AFQT). It is shown in this comment that they obtained a downward biased estimate of the true profitability of schooling for their sample and that the correct rate of return may be at least 13 percent. While this is lower than the rate of return to males from high school, it is similar to the private return from college.' The HWS data are a sample taken in November 1963 of approximately 2,400 males, aged 17 to 25. The dependent variable (Y) is annual income in 1962 after deducting transfer payments. The explanatory variables include years of schooling (S), age (A), AFQT score (AFQT), and a dummy variable which takes the value of one if the individual received training outside of school (T). Their model is