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# Introduction: Perspectives on Cultural Integration of Immigrants

Chapter:
(p.1) 1 Introduction: Perspectives on Cultural Integration of Immigrants
Source:
Cultural Integration of Immigrants in Europe
Publisher:
Oxford University Press
DOI:10.1093/acprof:oso/9780199660094.003.0001

# Abstract and Keywords

This introduction, building on the recent economics of cultural transmission, introduces the main conceptual issues which are of relevance to the study of the cultural integration patterns of immigrants and of their interaction with market and non-market outcomes. More specifically, this chapter briefly discusses the different theories of cultural integration developed in the social sciences. This chapter documents in more detail the economic approach to the study of cultural integration and discuss the consequences of cultural integration in terms of its socio-economic impact on host countries.

Keywords:   immigrants, integration, assimilation, cultural identity, economic integration

# 1.1 Introduction

The concepts of cultural diversity and cultural identity are at the forefront of the political debate in many western societies. In Europe, the discussion is stimulated by the political pressures associated with immigration flows, which are increasing in many European countries, as shown in Figure 1.1. Dealing with the ethnic and cultural heterogeneity associated to such trends is one of the most important challenges that European societies will face. The debate on the perceived costs and benefits of cultural diversity is already intense. This is well illustrated, for instance, in France, where discussions about the wearing of the Islamic veil and the burqa stimulated, in turn, a public debate on national identity. Similarly, the recent vote in Switzerland against the construction of Muslim mosques clearly shows how heated and emotional arguments on ethnic and religious identity have recently become.

Sociologists have been studying the cultural integration patterns of immigrants at least since the late nineteenth century, especially in the context of immigration into the United States. Economists have instead been traditionally mainly interested in assessing the direct impact of immigration flows on market outcomes (especially on the labour market) or on fiscal transfers and public goods provision. The basic question of assimilation for economists has, then, been framed in terms of economic (p.2)

Figure 1.1 Immigration flows in European countries.

Source: United Nations Population Division

assimilation, namely in terms of the dynamics of immigrants’ earnings and socio-economic positions relatively to natives. Recently, however, economists have been recognizing that, beyond interactions directly mediated through markets, prices and incomes, other non-market social and cultural interactions could also be important determinants of the socio-economic integration of immigrants. Specific patterns of cultural attitudes of immigrant groups can significantly affect their labour market performances, for instance. The common social phenomenon of ‘oppositional’ identities, by which certain minority individuals actively reject the dominant majority behavioural norms, can produce significant economic and social conflicts as well as adverse labour-market outcomes.

More generally, social scientists have dedicated a lot of attention to the fact that immigrants’ integration patterns can significantly alter the design and the political economy of public policies in the host society. An example of this issue concerns the sustainability of welfare state institutions in the context of multicultural societies. Cultural diversity may indeed affect the sense of community and social solidarity which constitute founding pillars of democratic welfare state systems. This could lead to the erosion of the social consensus for redistribution and diminish the political support for universal social programmes. Public policies aimed at correcting for horizontal inequalities across cultural groups, might end up substituting for vertical redistribution across social classes.

(p.3) For these reasons, several observers favour explicit public policies promoting, or even requesting, the cultural assimilation of immigrants to the cultural attitudes of natives. Other observers, however, argue that welfare state institutions should be designed to accommodate cultural diversity. These policies would facilitate contacts across communities, promote tolerance, trust, and respect towards other groups and, in the end, would help develop new national identities.

In either case, the study of cultural and socio-economic integration patterns of immigrants seems of paramount importance, as such patterns determine how the expression of cultural differences is translated into individual behaviour and public policy. The imperatives that current immigration trends impose on European democracies bring to light a number of issues that need to be addressed. What are the patterns and dynamics of cultural integration? How do they differ across immigrants of different ethnic groups and religious faiths? How do they differ across host societies? What are the implications and consequences for market outcomes and public policy? Which kind of institutional contexts are more or less likely to accommodate the cultural integration of immigrants? All these questions are crucial for policy makers and await answers.

In this context, the purpose of this book is to provide a modest but nevertheless essential contribution as a stepping stone to the debate. Taking an economic perspective, the collection of essays in this book presents the first descriptive and comparative picture of the process of cultural integration of immigrants in Europe, as it is taking place. We provide in the country chapters a detailed description of the cultural and economic integration process in seven main European countries and in the United States. The European countries include France, Germany, Italy, Spain, Sweden, Switzerland, and United Kingdom. We then provide in the conclusion of the book a cross-country comparison of the integration process using a unified database, the European Social Survey. The conclusion concentrates on the interplay between the cultural and economic integration process across European countries, and discusses how those various dimensions of integration correlate with specific national policies aimed at immigrants’ integration.

In this first chapter, building on the recent economics of cultural transmission, we introduce the main conceptual issues which are of relevance to the study of the cultural integration patterns of immigrants and of their interaction with market and non-market outcomes. More specifically, this chapter is organized as follows. In Section 1.2 we discuss briefly the different theories of cultural integration developed in the social sciences. In Section 1.3 we introduce in more detail the economic (p.4) approach to the study of cultural integration. In Section 1.4 we provide a short overview of the main conceptual issues associated with measuring cultural integration processes. In Section 1.5 we discuss cultural integration in terms of its socio-economic impact on host countries. Finally, in Section 1.6 we conclude with a brief overview of the subsequent chapters included in this book.

# 1.2 Cultural integration theories in the social sciences

Three main perspectives on cultural integration confront themselves in the social sciences: assimilation theory, multiculturalism, and structuralism. This section briefly discusses the main elements of each of these conceptual views as well as those of a recent synthetic perspective, called segmented assimilation.

## 1.2.1 Assimilation theory

In the literature on the cultural integration of immigrants, the perspective of assimilation theory has dominated much of the sociological thinking for most of the twentieth century. This approach builds upon three central features. First, diverse ethnic groups come to share a common culture through a natural process along which they have the same access to socio-economic opportunities as natives of the host country. Second, this process consists of the gradual disappearance of original cultural and behavioural patterns in favour of new ones. Third, once set in motion, the process moves inevitably and irreversibly towards complete assimilation. Hence, diverse immigrant groups are expected to ‘melt’ into the mainstream culture through an inter-generational process of cultural, social, and economic integration.

This view is exemplified, for example, by Gordon (1964), who provides a typology of assimilation patterns to capture this process. In Gordon’s view, immigrants begin their adaptation to their new country through cultural assimilation, or acculturation. Though cultural assimilation is a necessary first step, ethnic groups may remain distinguished from one another because of spatial isolation and lack of contact. Their full assimilation depends ultimately on the degree to which these groups gain the acceptance of the dominant population. Socio-economic assimilation inevitably leads to other stages of assimilation through which ethnic groups eventually lose their distinctive characteristics.

Assimilation theory seemed to be rather corroborated by the experience of the various waves of European immigrants that arrived in the (p.5) USA between the 1920s and the 1950s. As indicated by assimilation theory, these groups of immigrants followed progressive trends of social mobility across generations and increasing rates of intermarriage, as determined by educational achievements, job market integration, English proficiency, and levels of exposure to American culture (see for instance Alba, 1985; Chiswick, 1978; Lieberson and Waters, 1988). In the 1960s, the classical assimilation perspective was challenged in the USA by the cultural integration patterns of more recent non-European immigrant groups. Instead of converging into the mainstream culture, these groups appeared to preserve their ethnic and religious identities, making cultural differences more persistent than assimilation theory would conventionally predict. Differential outcomes with respect to natives seemed to prevail even after long-term residence in the USA (Kao and Tienda, 1995; Rumbaut and Ima, 1988; Suarez-Orozco and Suarez-Orozco, 1995; and Landale and Oropesa, 1995). Disadvantages were reproduced, rather than diminished (Gans, 1992). Patterns of mobility across generations were observed to have divergent rather than convergent paths (Becker, 1963; Goffman, 1963; and Perlmann, 1988). This evidence turned out to lead to the development of alternative approaches to the study of cultural integration.

## 1.2.2 Multiculturalism

One such alternative approach is multiculturalism, which rejects the simple integration process proposed by assimilation theory. Scholars from this perspective view multicultural societies as composed of a heterogeneous collection of ethnic and racial minority groups, as well as of a dominant majority group. This view has been forcefully illustrated by Glazer and Moynihan (1970) and by Handlin (1973) in the context of the American society. They argue that immigrants actively shape their own identities rather than posing as passive subjects in front of the forces of assimilation. These authors also emphasize that some aspects of the cultural characteristics of immigrants may be preserved in a state of uneasy co-existence with the attitudes of the host country. The multicultural perspective offers, then, an alternative way of considering the host society, presenting members of ethnic minority groups as active integral segments of the whole society rather than just foreigners or outsiders.

## 1.2.3 Structuralism

Rather than focusing on the processes of assimilation or integration per se, the structuralist approach emphasizes how differences in (p.6) socio-economic opportunities relate to differences in social integration of ethnic minority groups. Unequal access to wealth, jobs, housing, education, power, and privilege are seen as structural constraints that affect the ability of immigrants and ethnic minorities to socially integrate. This leads to persistent ethnic disparities in levels of income, educational attainment, and occupational achievement of immigrants (Blau and Duncan, 1967; Portes and Borocz, 1989). Consequently, the benefits of integration depend largely on what stratum of society absorbs the new immigrants. Contrary to the perspectives of assimilation theory and of multiculturalism, structuralism emphasizes the inherent conflicts that exist in the social hierarchy between dominant and minority groups and therefore questions even the possibility of cultural and socio-economic integration of immigrants.

To summarize, assimilation theory, multiculturalism, and structuralism provide different views of the same phenomenon. The focus of assimilation theorists is on immigrants’ succeeding generations gradually moving away from their original culture. Multiculturalists acknowledge that the cultural characteristics of immigrants are constantly reshaped along the integration process and therefore may never completely disappear. Structuralists emphasize the effects of the social and economic structure of the host country on the ability of immigrants to integrate into its cultural attitudes and to share its economic benefits. While each of the previous perspectives insists on one specific dimension of the integration pattern of immigrants, segmented assimilation theory provides a synthesis of these distinctive approaches.

## 1.2.4 Segmented assimilation synthesis

The main objective of this line of research is to provide a more complete picture of the different patterns of integration among immigrants in terms of convergent or divergent paths of cultural adaptation. More precisely, this theory envisions the process of cultural integration along three possible patterns: (1) an upward mobility pattern associated with assimilation and economic integration into the normative structures of the majority group; (2) a downward mobility pattern, in the opposite direction, associated to assimilation and parallel integration into the underclass; (3) economic integration but lagged assimilation and/or deliberate preservation of the immigrant community’s values and identity (see Portes and Zhou, 1994). This theoretical perspective attempts to explain the factors that determine which segment of the host society a particular immigrant group may assimilate into. Its focus is on how various socio-economic and demographic factors (education, (p.7) native language proficiency, place of birth, age upon arrival, and length of residence in the host country) interact with contextual variables (such as racial status, family socio-economic backgrounds, and place of residence) to produce specific cultural integration patterns of a given cultural minority group.

# 1.3 Economic approach to cultural integration

While other social scientists tend to focus on the effects of the social environment on cultural patterns across groups, the starting point of the economic approach to cultural integration is the analysis of individual behaviour, extended to account for endogenous preferences and identity formation. Economists, therefore, emphasize the importance of individual incentives and of the opportunity costs associated with different integration patterns.

A first simple model capturing the incentives for cultural integration is provided by an analysis of adoption of a common language by Lazear (1999). In this framework, individuals from two different cultural groups (a minority and a majority) are matched to interact economically and socially. Cultural integration facilitates trade across individuals.2 The incentives for an individual belonging to the minority cultural group to assimilate and adopt the culture of the majority are then directly related to the expected gains from trade that such a strategy provides.

More specifically, consider a simple environment in which each individual is randomly matched with one and only one other individual each period. Let the two cultural groups be denoted A and B, and let pA and pB denote the proportions of individuals who belong to culture A and B, respectively. Finally, let A represent the majority group: pA = 1– pB 〉1/2.3 A minority individual may encounter another individual of his own group and get an expected gain from trade VB. Alternatively, he may interact with an individual from the majority group A, in which case he receives an expected gain VA if he shares (p.8) common cultural elements with that group (i.e. if he made a specific effort at assimilating the majority culture), and a lower gain fVA (with f 〈1) if he does not.

When individuals of group B acquire group A’s cultural values, they become ‘assimilated’ into group A. They may still retain some or all of their old culture, but they now have the ability to trade with the majority group. For instance, in the specific case of language adoption, assimilation can be thought of as becoming fluent in the majority language, while possibly retaining the ability to speak the native tongue. It is reasonable to assume that cultural assimilation is costly and resources must be spent to acquire new cultural traits (e.g. to learn a new language). Moreover, these costs may be individual specific. Denote, therefore, by ti the individual-specific cost parameter that measures (inversely) the efficiency with which individual i acquires the new culture. Formally, ti is distributed with density and distribution function g(ti) and G(ti), respectively. Individuals make their cultural assimilation choices with no coordinated group strategy. When an individual belonging to group B does not assimilate to the culture of the majority, his expected gain is pB VB + pA f VA. On the other hand, when he does assimilate, his expected gain is pB VB + pA VA − ti. It follows that an individual belonging to group B will culturally assimilate when ti 〈 pA(1−f)VA; that is, if the individual cost ti of acquiring the cultural trait of group A is smaller than the expected benefit pA(1−f)VA of such assimilation strategy. Aggregating over all individuals of group B that find it profitable to acquire the cultural trait of group A, the fraction of assimilated individuals in the minority is sBA = G(pA(1−f)VA) = G[(1− pB)(1−f)VA].

Interestingly, this simple model produces three important implications. First, cultural assimilation is a decreasing function of the fraction pB of minority group members in society. Hence the smaller and the more dispersed the minority group, the more likely we should expect cultural assimilation for that group. Second, sBA is also an increasing function of the expected economic gain VA to be obtained by interacting with individuals belonging to the majority. Hence, the larger the economic benefits to be culturally integrated, the larger the incentives to assimilate. Third, cultural integration is increasing with (1−f), namely the degree of inefficiency associated with interacting with individuals of the majority without sharing their cultural traits. Hence, the more important is the sharing of a common culture to enjoy social interactions, the larger, again, are the incentives to assimilate for the minority group. Two additional implications of Lazear’s model are also worth emphasizing. From a normative perspective, there is a crucial externality (p.9) in the assimilation process. Indeed, the larger the fraction of minority individuals which assimilate, the higher are the expected gains from trade for the majority. Clearly, when deciding whether to assimilate, individuals belonging to the cultural minority do not internalize these gains. At least from the point of view of the majority group, this provides a rationale for integration policies which subsidize the assimilation of minorities. Furthermore, this framework can be easily expanded to allow for multiple minority groups. In this case, cultural assimilation will be favoured in the presence of a relatively even distribution of minority groups. The existence of relatively large minorities, in fact, reduces the incentives of each minority group to adopt the culture of the majority. Again, straightforward policy implications can be obtained, favouring even distributions of immigrants by cultural identity.

## 1.3.2 Identity formation

While the model of Lazear (1999) puts its emphasis on the potential gains from trade associated with the interaction between members of different communities, Akerlof and Kranton (2000) concentrate more directly on cultural identity as an important source of the gains or losses associated with social interactions between different groups. Building on insights from social psychology and sociology, Akerlof and Kranton introduce the concept of social identity in economic models and discuss how it may interact with individuals’ incentives. More specifically, identity is defined as a person’s self-image, based on given social categories and on prescriptions associated with these categories. Each person has a perception of his own categories and that of all other people. Prescriptions, in turn, indicate which behaviour is deemed appropriate for people in different social categories and/or in different situations. Prescriptions may also often describe ideals for each category in terms of physical and material attributes.

In this conceptual context, Akerlof and Kranton emphasize two dimensions of identity formation which are relevant to understand cultural integration. First, categorizations and prescriptions are learned and acquired by individuals through processes of internalization and identification with respect to others who share these categories, that is, who belong to the same cultural group. This implies in particular that one’s self image depends on how one satisfies the prescriptions of the category. Moreover, as identification is a crucial part of the internalization process, a person’s self-image can be threatened by others’ violation of the set of prescriptions he identifies with. Indeed, prescriptions (p.10) associated with one group or category are often defined in contrast to those of others. This dimension provides a source of potentially important social externalities when individuals interact with each other. Second, Akerlof and Kranton’s cultural identity is not given. Individuals choose assignments to social categories (form their identity) by means of actions corresponding to these categorizations. Hence, incentives can affect the process of identity formation. As in Lazear (1999), the costs of cultural assimilation may relate to different factors such as the size of the groups, the economic gains from trade and interactions, the role of frictions in social interactions and matching.

An important application of this conceptual framework is to the study of oppositional cultures, when minorities adopt cultural categorizations and prescriptions defined in opposition to the categorizations and prescriptions of the dominant majority. Oppositional cultures often correspond to behaviour which requires significant economic costs for members of the minority group adopting the culture. At the heart of the emergence of oppositional cultures, according to Akerlof and Kranton, lie two crucial factors: social exclusion and lack of economic opportunities.4 Social exclusion derives from the well established sociological fact that dominant groups define themselves by differentiation and exclusion of others. This in turn creates a conflict for minority members: how to work within the dominant culture without betraying one’s own. Such social differences may then open the possibility for adoption of oppositional identities by those in excluded groups. Lack of economic opportunity may also contribute to the adoption of an oppositional identity. For instance, it has been noted that the decline in well-paid, unskilled jobs could result in loss of self-respect by men who cannot support their families, and the rise in inner city crime and drug abuse (Wilson, 1996). Similarly, Liebow (1967) in a famous ethnographic work on ‘corner street’ men (i.e. street beggars and idlers) describes how the lack of decent-paying work leads these individuals towards the adoption of identities which severely inhibit the value of any labour market skill they may possess, in an attempt to avoid suffering the guilt of failing to provide for themselves and their families.

Motivated by these and other ethnographic accounts of oppositional identities in poor neighbourhoods in the USA and UK,5 Akerlof and Kranton construct a model of identity formation where people (p.11) belonging to poor and socially excluded communities can choose between two identities: the dominant culture or an oppositional identity which rejects it. Each identity is defined by a set of prescriptions on certain actions/decisions that ought to be taken. From the perspective of the dominant identity, the oppositional identity is perceived as inducing bad economic decisions, self-destructive behaviour (such as taking drugs, joining a gang, and becoming pregnant at a young age) which in turn can generate negative pecuniary externalities on the rest of the community. Also, the model accounts for important identity-based externalities: individuals adopting an oppositional identity may be angered by those who assimilate, because of their complicity with the dominant culture, while on the contrary those who assimilate may be angered by those individuals who oppose the dominant culture by breaking its prescriptions. Finally, social exclusion by the majority is modeled as a loss in identity that individuals from the minority will suffer if they choose to adopt the dominant culture. It represents the extent to which someone from the minority is not accepted by the dominant group in society. On the contrary, individuals who choose to adopt the oppositional identity do not suffer such a loss.

The model generates societies which in equilibrium display a prevalence of oppositional identities and ‘anti-social’ behaviour. Typically, an equilibrium with full assimilation of the dominant culture by the community is possible only when social exclusion from the dominant group is small enough. On the contrary, a positive level of social exclusion will always lead some people in the community to adopt an oppositional identity and some ‘self-destructive’ and ‘anti-social’ behaviour. Importantly, the ‘self-destructive’ behaviour is not the result of the individual’s lack of rationality, but instead derives from lack of economic opportunity and a high degree of social exclusion. The model’s implications lend themselves to suggest policies designed to reduce the effects of social exclusion. In particular, training programmes which take trainees out of their neighbourhoods may eliminate the negative effects of interacting with individuals sharing oppositional identities and therefore may reduce the likelihood of the emergence of such cultures. Moreover, being in a different location may also reduce a trainee’s direct social exclusion loss from assimilation to the dominant culture as this loss may be both individual-specific and situational. Finally, the model also highlights issues in the affirmative action debate. In particular, the rhetoric and symbolism of affirmative action may affect the level of social exclusion by the dominant group. On the one hand, affirmative action may increase the perception of victimization of the minority community, therefore reinforcing social differentiation and exclusion (p.12) from the dominant group (Loury, 1995). On the other hand, affirmative action may decrease social exclusion, to the extent it is seen as a form of acceptance of the minority into the dominant culture.

## 1.3.3 Acculturation strategies

One important element of the previous analyses is the fact that cultural identity formation is modeled as a simple binary choice: individuals with foreign backgrounds either choose to identify with the dominant culture or to their (e.g. ethnic) minority culture. Even when the model is extended to allow for oppositional identity, its scope and complexity is limited by assuming that a stronger identification to the culture of the majority necessarily implies a weaker identification to the ethnic minority. These views, however, have been criticized as too simplistic to capture the different possible patterns of cultural integration of minorities. Indeed, studies within cross-cultural psychology suggest a more complex model of identity formation,6 treating the degree of identification with the culture of the majority as separate and independent from the degree of identification with the minority culture. Individuals may, for example, simultaneously feel a strong affinity for the majority and for a minority culture.

For instance, Berry (1997) actually considers four distinct acculturation strategies regarding how individuals relate to an original ethnic culture of the minority group and the dominant culture of the majority (see Figure 1.2). The first strategy, integration, implies a strong sense of identification to both the original and the majority culture. The second, assimilation, requires a strong relationship with the majority culture but a weak relationship with the original culture. The third, separation, is associated to a weak connection with the majority culture but a strong connection with the original culture. Finally, the fourth strategy, marginalization, involves a weak link with both the majority and the original culture.

While such an identity formation structure has been discussed empirically in several recent economic studies of migrants’ cultural integration (see Constant et al., 2006; Zimmermann et al., 2007; Nekby and Rödin, 2007), little conceptual analysis has tried to disentangle the incentives of minority individuals to adopt a particular acculturation strategy in this framework. Consider, then, a specific minority or ethnic group that is part of the larger society. Each individual member derives (p.13)

Figure 1.2 Two-dimensional identity model (Berry, 1997).

utility from a general aggregate consumption good as well as from a group-specific good that effectively defines the identity of the group. Consumers allocate their time between ethnic and general activities that respectively enter as inputs in the household production function of the ethnic and general goods.

Individuals may as well invest in human capital, increasing the productivity of the household technology for the group-specific good and for the general good. More specifically, human capital can be distinguished along two types: group-specific human capital, that enhances the skills relevant for producing the group-specific good and general shared human capital. Group-specific or ethnic human capital is associated with skills and experiences that are useful only for members of that group, for example language, religion, or customs affecting family relationships. On the other hand, shared human capital develops skills that raise the household’s productivity of the general good, like, for example, the mastery of a common language, and general skills useful in the labour market.

Group specific human capital accumulation, in the form, for example of ‘ethnic education’, begins with ethnic-specific parenting styles, family customs, cultural socialization, and group-specific training within the ethnic community. The key parameter in Chiswick’s model is the degree of complementarity or substitutability between the accumulation processes for group-specific and general shared human capital. The types of acculturation strategies that emerge for members of the minority depend crucially on these complementarity and substitutability effects. The model is able, therefore, to successfully connect the pattern of investments in group specific and general human capital to the acculturation strategies that minority individuals may choose. More specifically, it suggests that strong complementarities between group-specific human capital and general human capital will favour the emergence of cultural integration, where individuals in the minority invest in the (p.14) accumulation of both types of human capital, and consequently develop strong identification to both their original culture and the general dominant culture of society. On the contrary, substitutability in human capital accumulation promotes the occurrence of cultural assimilation or cultural separation, where individuals in the minority will only identify with one culture at the cost of the other. Marginalization will finally occur when substantial fixed costs dampen the accumulation of both types of human capital.

Cultural integration has an essential dynamic character across time and generations. Several recent economic approaches have tried to incorporate these features in their analyses. A dynamic approach to cultural assimilation is described by Konya (2005), who extends the static framework of Lazear (1999) to a dynamic context. Individual members of a small minority group may decide to assimilate with the dominant majority culture or not. Individuals live for one period and have exactly one child each. They are dynastic altruists in the sense that they are concerned with their own utility as well as the utility of their future ‘dynasty’. As in Lazear (1999), assimilation strategies have a single dimension: minority individuals either assimilate completely into the culture of the majority or they do not, remaining as members of the minority group. Each child is born inheriting the culture adopted by his parent. Any child born inheriting the culture of the minority chooses in turn to either assimilate or not. Children of assimilated parents belong instead irreversibly to the dominant majority group. As in Lazear (1999), individuals are matched randomly in society and gains from trade obtain from the resulting social and economic interactions. A match between members of the same group generates a larger gain than a match between individuals of different groups. Belonging to the majority group is therefore relatively desirable because of scale effects. But assimilation is costly. Thus, when deciding about cultural assimilation, minority members weight the benefits and the costs. In contrast to the static approach, rational forward-looking altruistic individuals take into account the future expected benefits of assimilation accruing to their whole dynasty. An important feature of the dynamics is the fact that incentives for assimilation change for successive generations, according to changes in the population structure over time. The model highlights the crucial role of the initial size of the minority group. When the minority is initially small, the long-run outcome is full assimilation. When the minority is instead initially large, the unique long-run (p.15) equilibrium is the initial distribution, that is, full cultural separation. Interestingly, for intermediate minority sizes, multiple long-run distributions are possible, including the full and no-assimilation ones.

The subtle interactions between the initial structure of the population and the role of expectations of population changes on the future gains of assimilation explain the dynamics of the distribution of the population across cultural groups. Suppose that the members of the minority expect the population structure to remain the same as initially and that in such an environment, assimilation is too costly for any individual. Then clearly there will not be cultural assimilation and the population distribution across cultural groups will replicate itself indefinitely, confirming the initial expectations of the members of the minority. On the other hand, suppose that minority individuals anticipate a drastic assimilation process of their own group with the majority and that, under such changing circumstances, the gains to assimilation are largely increased. Then, possibly, a fraction of minority individuals assimilate. This in turn might validate the expectations of assimilation. Depending on the initial beliefs shared inside the minority community, one may end up in two very different situations in the long run, everything else being equal.

From a normative perspective, the analysis points to two basic inefficiencies that characterize the dynamics of assimilation. First of all, the speed of assimilation may be too small as there are positive external effects of assimilation on the majority that are not internalized by minority members. Indeed, when interacting with minority members, majority members benefit from meeting an assimilated minority member, but the latter do not take this into account. This suggests a rationale for policies that tend to subsidize the assimilation strategy of minorities, as in the static case. The second source of inefficiency relates to the existence of multiple equilibrium paths of cultural assimilation. One such path might Pareto dominate another, while expectations coordinate on the second, along which society would end up converging to the stationary state.

At the heart of Konya’s (2005) approach to cultural assimilation is the dynastic altruism assumption: parents weigh the dynamic socio-economic gains from cultural assimilation that they and their children will enjoy against the direct costs of assimilating. However, parents’ decisions about cultural assimilation may also be motivated by a desire to transmit to their children their own (the parents’) values, beliefs, and norms per se. Parents may be altruistic toward their kids, but in ‘paternalistic’ manner. Parents, in fact, are typically aware of the different traits children will be choosing to adopt and of the socio-economic (p.16) choices they (the children) will make in their lifetime. Parents might then evaluate these choices through the filter of their own (the parents’) subjective views, that is, they might not ‘perfectly empathize’ with their children. As a consequence of imperfect empathy, parents, while altruistic, might prefer to have their children sharing their own cultural trait. Imperfect empathy provides in fact a natural motivation for the observation that parents typically spend substantial time and resources to socialize their children to their own values and cultures. This obviously may have implications for the observed pattern of integration and identity formation of cultural minority groups.

## 1.3.5 Cultural transmission

Building on evolutionary models of cultural transmission (Boyd and Richerson, 1985), Bisin and Verdier (2000, 2001) incorporate parental socialization choices under imperfect empathy in their study of the dynamics of cultural transmission and integration patterns. In particular, Bisin and Verdier’s model has relevant implications regarding the determinants of the persistence of different cultural traits in the population. Cultural transmission is modelled as the result of the interaction between purposeful socialization decisions inside the family (‘direct vertical socialization’) and indirect socialization processes like social imitation and learning (‘oblique and horizontal socialization’). The persistence of cultural traits or, on the contrary, the cultural assimilation of minorities, is determined by the costs and benefits of various family decisions pertaining to the socialization of children in specific socio-economic environments, which in turn determine the children’s opportunities for social imitation and learning.

More precisely, Bisin and Verdier (2001) consider the dynamics of a population with two possible cultural traits (A and B). Let q denote the fraction of the population with trait A, and (1−q) the fraction with trait B. Families are composed of one parent and one child. All children are born without defined preferences or cultural traits, and are first exposed to their parent’s trait, which they adopt with some probability di, for i = A or B. If a child from a family with trait i is not directly socialized, which occurs with probability 1−di, he picks the trait of a role model chosen randomly in the population (i.e. he/picks trait A with probability q and trait B with probability 1−q). The probability that a child of a parent of trait A also has trait A is therefore ΠAA = dA + (1−dA)q; while the probability that he has trait B is Π AB = (1−dA )(1−q). The probabilities ΠBB and ΠBA, by symmetry, are ΠBB = dB + (1−dB )(1−q) ΠBA = (1−dB)q. The probability of family socialization di can be affected by the parent (p.17) through various forms of costly effort. The benefits of socialization are instead due to imperfect empathy. For each parent, the chosen level of socialization effort will balance out the marginal cost of that effort against the marginal benefit of transmitting one’s own culture.

In such a context, Bisin and Verdier (2001) analyse the resulting population dynamics of cultural traits, that is, the dynamics of the distribution of the population across cultural traits, with the objective of characterizing the conditions which give rise to persistence of cultural diversity in the long run. They show that the crucial factor determining the composition of the stationary distribution of the population consists in whether the socio-economic environment (oblique socialization) acts as a substitute or as a complement to direct vertical family socialization. More precisely, direct vertical socialization is viewed as a cultural substitute to oblique transmission whenever parents choose to socialize their children less when their cultural trait is more widely dominant in the population. This would be the case, intuitively, if parents belonging to the dominant majority tended to rely mostly on indirect ‘oblique and horizontal’ mechanisms to socialize their children, since such mechanisms are naturally more effective for cultural majorities than minorities. This property of the socialization mechanism promotes the persistence of cultural differences in the population. On the contrary, direct vertical transmission is a cultural complement to oblique transmission when parents socialize their children more intensely the more widely dominant their cultural trait is in the population. In such a case, the population dynamics converges to a culturally homogeneous cultural population. The complementarity between family and society in the process of intergenerational socialization gives a size advantage to the larger group (the majority) both in terms of direct vertical family socialization and in terms of indirect ‘oblique and horizontal’ socialization. This promotes the assimilation of the minority group and cultural homogeneity in the long run.

While Bisin and Verdier’s (2001) model is stated in terms of general socialization mechanisms, specific choices contribute to direct family socialization and hence to cultural transmission. Prominent examples are, for example, education decision, family location decisions, and marriage.7 The simple analytics of the model are obtained when the (p.18) benefits of socialization are based on purely cultural motivations and are in particular independent of the distribution of the population. Many interesting analyses of cultural transmission require this assumption to be relaxed. Indeed, in many instances the adoption of a dominant cultural trait might provide a beneficial effect per se. An obvious example is Lazear (1999), where the adoption of the dominant language has beneficial effects in the labour market. In this case altruistic parents, even if paternalistic, might favour (or discourage less intensely) the cultural assimilation of their children. This trade-off between ethnic preferences and the disadvantage of minority traits in terms of economic opportunities may be central to the integration pattern of immigrants in the host country. Interestingly, when these elements are incorporated in cultural transmission models (Bisin and Verdier, 2000), they result in the existence of multiple equilibrium pattern of cultural assimilation and issues of coordination of beliefs across and within cultural groups.

In the previous sections, we reviewed some of the theoretical frameworks developed in the literature for the study of integration patterns of members of cultural minorities. These analyses stress three interesting components: structural socio-economic opportunities, complementarities and substitutabilities between the minority and the majority cultures, externalities and the role of expectations and beliefs. We discuss each of them in turn.

## 1.3.6 Socio-economic opportunities

As the structuralist approach in sociology, the economic analysis of cultural integration emphasizes the role of economic incentives and opportunities. Incentives and opportunities are in particular affected by the size of the minority group. Indeed, assimilation to the dominant culture is likely to provide scale benefits in terms of economic interactions. Therefore we should generally expect smaller minorities to culturally assimilate faster and more easily than bigger minorities. Also, the socio-economic gains of cultural assimilation depend importantly on several host country institutional factors as well as on the reactions of the dominant group to the pattern of integration of minorities. Specifically, supply factors such as forms of socio-economic exclusion by the dominant group may significantly reduce the demand for cultural assimilation by members of minorities and may stimulate, on the contrary, the adoption of strategies leading to cultural separation. In certain circumstances, socio-economic exclusion by the dominant group could (p.19) even create the conditions for the emergence of oppositional cultures, as a sort of ‘negative demand’ for assimilation.

## 1.3.7 Complementarities and substitutabilities in human capital and socialization processes

Two dimensions of the degree of complementarities and substitutabilities between the minority culture and the majority culture appear relevant to understanding and explaining different integration patterns. First, as illustrated by Chiswick‧s human capital formation approach, complementarities in skill learning processes tend to favour similar and positively correlated patterns of human capital accumulation in different cultures. This leads to integration when associated with high levels of investments and marginalization when associated with low levels of investments. On the other hand, substitutabilities lead to negatively correlated human capital investments between minorities and the majority. Second, as suggested by Bisin and Verdier’s cultural transmission framework, complementarities and substitutabilities between direct vertical family socialization and indirect oblique mechanisms of socialization may significantly affect the intensity with which minority members engage in cultural transmission to their children. Again, group size effects matter. When socialization mechanisms are characterized by complementarities in imitation processes and exposure to role models, minority parents tend to reduce their direct transmission efforts when they expect their children to be less exposed to cultural role models of their own group. On the contrary, when family and society are interacting as cultural substitutes in socialization, minority members try to compensate by their own socialization effort for the fact that their group’s cultural influence is reduced.

Combining these two dimensions suggest conditions under which the four acculturation strategies of Berry’s (1997) typology, as described in Figure 1.2, are likely to emerge. This is summarized in Figure 1.3. The horizontal dimension characterizes the degree of complementarity versus substitutability between group specific human capital and general human capital. The vertical dimension describes the degree of cultural complementarity versus substitutability between family and external cultural influences. Box 1 in Figure 1.3 represents the socialization environment characterized by substitutability along both dimensions. In this case minority groups are likely to socialize their children intensively with their own group specific values and skills. Because group specific human capital is a substitute for general human capital, this is likely to lead to cultural separation and significant cultural resilience of the (p.20)

Figure 1.3 Multi-dimensional models: a synthesis.

minority group. Box 2 in Figure 1.3 represents an environment where cultural transmission is characterized by cultural substitutability, while the two types of human capital are complements. In this case, minority group individuals again intensively transfer their values and traits to their children. At the same time, the complementarity between group specific skills and general skills implies also high levels of investments in general human capital. Hence cultural integration, where second-generation individuals are integrated with the majority group and still preserve many of their own distinctive characteristics, will tend to obtain. Alternatively, Box 3 in Figure 1.3 represents a socialization environment with cultural complementarities in socialization and substitutabilities between group specific and general skills. In this case, minority individuals weakly transmit their own cultural traits and, correspondingly, there is more investment in general human capital. This is likely to lead to a cultural assimilation across generations. Finally, the last configuration, in Box 4 in Figure 1.3, corresponds to an environment with complementarities along both dimensions. Minority group individuals provide weak socialization effort and low investment in general human capital. This induces marginalization, with little attachment to the original minority culture and also low integration with the majority group.

## 1.3.8 Externalities and expectations

All theoretical frameworks developed in the literature for the study of integration patterns we have discussed previously, highlight the fact that socialization and dynamic cultural evolution processes are (p.21) characterized by several externalities. First of all, positive external effects of assimilation on the majority are by the choices of minority members, specifically when assimilation involves more efficient communication and coordination and therefore a larger surplus to be shared between minority and majority groups. A consequence of this externality is that cultural integration might proceed too slowly and would need subsidization. Second, individual socialization and assimilation choices are formed under certain sets of beliefs about the aggregate process of cultural dynamics itself. How such beliefs are formed and coordinated upon may affect the path of cultural integration. Again, this leaves scope for the emergence of collective institutions allowing individuals to coordinate their socialization and assimilation choices on a path that is socially efficient.

# 1.4 Measuring cultural integration

The integration process of an individual of a specific immigrant group into his host country is characterized by several dimensions, typically aggregated into four distinct but not mutually exclusive general categories: economic, legal, political, and social integration. The first category, economic integration, is associated with integration processes in ‘market’ relationships. These include integration in the labour market, in residential location, in education and training in skills which are valued in market interactions. The second category, legal integration, relates to the evolution of an immigrant’s status and its implications for his (or her) conditions of stay. The third category is political integration. It connects to the public and political sphere, and to collective decision‐making processes in the host country. Typically it includes interest in local political processes, participation in political organizations, voting, etc. Finally, cultural integration is the fourth category. It is associated with the social and cultural sphere and concerns cultural habits, values and beliefs, religion, and language. It involves dimensions which are not generally intermediated directly through markets or political processes. Measuring the cultural integration of minority groups implies, therefore, searching for indicators that essentially relate to all these categories.

## 1.4.1 Behavioural data

A first approach in measurement of integration consists in collecting empirical observations regarding the actual behaviour of minority (p.22) individuals, and assessing how it differs from that of majority group members. Typical indicators include language spoken at home, religious practice, fertility patterns, educational achievement, gender gaps in education or labour market participation, prevalence of female labour supply, social participation, and marriage behaviour (intermarriage rates, marriage rates at age 25, cohabitation, divorce, partner age gaps, etc,).

One specific measure of objective behaviour that has attracted significant attention is intermarriage. It is generally considered as evidence of growing cultural ‘integration’. A high rate of intermarriage signals reduced social distance between the groups involved and the fact that individuals of different ethnic backgrounds no longer perceive social and cultural differences significant enough to prevent mixing and marriage (Gordon, 1964; Kalmijn, 1998). There are several reasons why intermarriage may be an important indicator of integration. First, marriage is an important mechanism for the transmission of ethnically specific cultural values and practices to the next generation. Hence intermarriage, by changing the scope for socialization, may fundamentally affect the boundaries and distinctiveness of ethnic minority groups (Bisin and Verdier, 2000). Also, intermarriage at significant and sustained rates leads to major demographic changes in society, in particular to the emergence of ‘mixed’ children. This has important implications for the evolution of ethnic categorizations. Intermarriage is constrained by a variety of factors, such as the size of groups, segregation, and socio-economic and cultural barriers. Among the variables often discussed as determinants, a major role is played by generational status (first versus second generation), educational attainment and socio-economic status, marriage pool structure of potential co-ethnic partners (group size, sex ratios at given socio-economic status), gender, religion, linguistic distances with majority group, residential integration, and spatial segregation (see, for instance, Furtado, 2006; Chiswick and Houseworth, 2008).

While it is generally assumed that intermarriage is a good indicator of immigrants’ integration, a number of caveats should, however, be kept in mind. First, intermarriages measured as such may not give an adequate picture of interracial relationships as, for instance, they do not include dating or cohabitation. Second, there are difficulties related to the criteria by which a union is counted as intermarriage. The status of certain minority groups is not always clear, and what constitutes intermarriage may often depend on the specific data. As noted by Song (2009), for instance, the US Census Bureau does not regard a marriage between a Japanese American and an Indian (South Asian) American as intermarriage, but the same union would count as such in Britain. More (p.23) generally, definitional questions on group boundaries (ethnic, racial, religious) may significantly affect the final picture regarding how intermarriages are recorded. Collected data lack a standardization of methods in recording and describing patterns of intermarriage across countries. In particular, it is difficult to obtain comparable cross-national data about intermarriage in Europe. Indeed in many cases in European data, groups’ boundaries are identified by the nationality or country of birth of marriage partners, rather than their ethnicity or race. More fundamentally, even if there is an observed correlation between intermarriages and cultural integration, the nature of the relationship between the two variables remains unclear. In most cases, analysts talk of integration as the outcome of intermarriage. But in some cases, intermarriage is also seen itself as an outcome of cultural integration, as it may reflect social acceptance of mixed marriages. Taking another perspective, some scholars (e.g. ethnic competition theorists) have argued that while intermarriage may be associated with a form of integration or of inclusion in some dimensions of the majority group, intermarried minority individuals are nonetheless not accepted in many mainstream social environments (Olneck, 1993). In particular, interracial partnerships do not automatically result in reduced prejudice within the couple, the family network, or society at large (Song, 2005).

## 1.4.2 Survey data

Rather than focusing on actual socio-economic behaviour, an alternative approach to assess the pattern of integration of minority groups considers subjective perceptions and attitudes on various socio-economic dimensions, categorizations, and prescriptions, as collected in survey data. Again, the basic question is to see how these variables differ between minority members and the mainstream majority group and what the determinants are of such differences. Attitudes on gender roles, religious practices or political beliefs, and convictions are generally included in these analyses. One dimension also often investigated concerns the degree of cultural identification to some mainstream characteristics such as national identity (see for instance Constant et al., 2006; Zimmermann et al., 2007).

Subjective attitudes and perceptions are interesting as they directly connect to an individual’s identification process. Some caveats, however, need to be mentioned. First, as is well known, survey data suffer from problems with framing: the way survey questions are designed and the responses are collected may significantly affect the answers of the subjects investigated. More importantly, subjective attitudes are just (p.24) expressive manifestations, reflecting what ‘one does or intends to do’ and one’s expectations of ‘what is socially acceptable to say in public’. Hence, subjective attitudes may only be partially related to the actual and objective behaviour of subjects, that is, immigrants in studies about cultural integration. Constant et al. (2006), for instance, recognize this problem in their analysis of immigrants’ identity formation in Germany. Rather than limiting themselves only to subjective attitudes, they construct the indicator along five key elements, some of which include objective behaviour.8 Using data from the German Socio-Economic Panel (GSOEP) on immigrants in the guest worker population, they follow the two-dimensional acculturation logic of Berry (1997) and present an ethnosizer indicator providing information on immigrants’ attachment to both their original culture and the German culture. Looking at how individuals get classified across the four regimes of acculturation (integration, assimilation, separation, and marginalization), Constant et al. (2006) then find that the classification obtained by the direct measure of ethnic self-identification correlates only weakly with the one derived with their ethnosizer indicator. This suggests that there are limitations in how actual behaviour can be inferred from survey data on subjective perceptions.

As emphasized by the literature, a large part of the cultural integration process of immigrants’ communities and minority groups goes through intergenerational shifts in behaviour and values. In order to assess such shifts, the literature focuses on how second-generation individuals compare to first-generation in terms of differences or similarities with respect to members of the majority group. For any given indicator, a convenient way to illustrate such dynamics is described in Figure 1.4. The vertical axis reflects the gap between first-generation immigrants and natives of the host country. This gap can be positive or negative. The horizontal axis reflects the gap between the second-generation immigrants and the natives of that same generation. The origin at 0 therefore is the point of perfect assimilation: immigrants do not show any difference with natives across either generation. A given point in that space shows how the first-generation gap compares with the second-generation gap. From this, one may uncover four different regimes describing the relative cultural dynamics between the immigrants or minority groups and natives or majority individuals. Quadrant I, in which both generations (p.25)

Figure 1.4 Intergenerational dynamics of cultural gaps between migrants/natives.

have positive gaps with respect to the host country, is divided into two regions. Above the 45° line is a regime of cultural convergence, as the gap with natives is smaller for second generation than for first generation. Conversely, the region below the 45° line represents a regime of cultural divergence between the two groups. Similarly, the 45° line divides quadrant III, with both generations having negative gaps compared to the host culture. A cultural convergence region lies below the 45° line, as the second generation shows a less negative gap than the first generation. Conversely, there is a cultural divergence region above the line, with the second generation having a more negative gap than the first generation. Although they are presumably less likely to be observed, there are also two other regimes represented respectively by quadrant II and quadrant IV. In quadrant II, the first generation has a negative gap with the natives while the second generation a positive one. This is therefore a ‘cultural leapfrogging’ regime, in which the immigrants overshoot the natives with respect to the indicator considered. Conversely, points in quadrant IV reflect the opposite situation of ‘cultural retraction’, in which the first generation has a positive gap while the second generation a negative one compared to the natives. This diagram captures in a condensed way the intergenerational dynamics of cultural integration of a given immigrant group compared to the natives. It can also be used to compare the relative cultural integration across different minority (p.26) groups and may help to identify strategies of acculturation of specific groups in Berry’s typology. For instance, regimes such as ‘cultural divergence’ or ‘cultural retraction’ are more likely to be consistent with ‘separation’ or ‘marginalization’ processes across generations, while on the contrary, regimes of ‘cultural convergence’ and ‘cultural leapfrogging’ may reveal processes of ‘integration’ or ‘assimilation’ of the minority.

# 1.5 The socio-economic impact of cultural integration and identity

Cultural integration phenomena interact in significant ways with how resources are allocated and redistributed in society. Integration patterns of immigrants may therefore have important implications for economic and political outcomes in society.

## 1.5.1 Labour market

Traditionally, economists have focused on how immigrants and minority groups directly integrate in the host economy through market transactions. For instance, a significant literature has investigated the impact that immigration has on the labour market in the host country, in terms of wages, employment, and income distribution for both natives and immigrants (see Kahanec and Zimmermann, 2008, for a survey of the literature). Typically, immigrants’ economic integration has been viewed as the process by which the earnings of immigrants come closer to those of natives (Chiswick, 1978). The observed cross-sectional pattern generally indicates that initially immigrants have earnings which are significantly below those of natives, conditional on education, skills, and demographic factors. This is explained by the fact that upon arrival, immigrants lack certain unobservable skills and information specific to the host labour market, such as language, educational qualifications, or general information about how to behave in the host country. With time spent in the host country, however, immigrants will tend to acquire the missing skills and information and catch up with the natives. Eventually, because of positive selection bias in the immigration process (i.e. the fact that individuals with stronger economic prospects in the destination economy are more likely to migrate), immigrants may even outperform the natives. While cross-sectional data prima facie seem to support such view of economic integration, they may also hide important cohort effects (Borjas, 1985), for example if more recent immigrants have unobservable characteristics that make them less (p.27) adapted to the labour market than the older cohorts. In this case, any immigrant group earning gaps with respect to natives are not so much because of slow economic integration but rather because of different cohort characteristics which cannot be identified by the statistical analysis of cross-sectional data.

Cultural integration patterns and identity formation are typically non-directly observable dimensions that may indeed interfere with the process of economic integration. A clear example of how cultural integration practices interact with economic integration is the generally observed labour market premium to intermarriage. A series of studies have found that immigrants married with natives or with spouses of a different ethnic group have higher earnings than immigrants in an ethnically homogamous marriage, after conditioning on the relevant earnings regressors (see Kantarevic, 2004; Meng and Gregory, 2005; Meng and Meurs, 2006; and Gevrek, 2009). The direction of causality is not always clear though. While Kantarevic (2004) fails to find a causal effect of intermarriage on earnings for the USA, Meng and Gregory (2005), Meng and Meurs (2006), and Gevrek (2009) suggest, on the contrary, that intermarriage has a causal effect on immigrants’ earnings in Australia, France, and the Netherlands, respectively. Controlling for the endogeneity of the intermarriage decision more than doubles the estimate of this marginal effect. Several studies have also uncovered connections between subjective attitudes and identity and labour market outcomes for individuals with a foreign background. For instance, Constant et al. (2006) and Zimmermann et al. (2007) have studied the connection between Berry’s categories of identity (integration, assimilation, separation, and marginalization) and the probability of being employed in Germany. While no systematic differences are found in labour market outcomes of integrated and assimilated men, integrated women seem to succeed better than assimilated ones. At the same time, for men and women alike, separated and marginalized individuals have a significantly lower probability of being employed than those who are assimilated. In other words, a strong minority identity does not seem to have any negative impact on labour market outcomes, provided that it is combined with a strong majority identity. In Sweden, Nekby and Rödin (2007) also find small differences in employment outcomes between individuals with an integrated identity and those with an assimilated identity. On the other hand, male individuals with a separated identity have considerably lower chances of being employed than those who are assimilated. There does not seem to be any systematic differences for women across the different cultural identities. Studying the effect of oppositional cultures on labour market outcomes, Battu and Zenou (p.28) (2008) show that for the UK, non-whites who are strongly opposed to the British identity have a significantly lower probability of being employed than non-whites who are not oppositional. Negative attitudes with respect to ethnically mixed marriages are also associated with a lower probability of being employed. There is, however, no ‘penalty’ in the labour market for individuals strongly identifying with their own cultural background per se.

In the end, the previous studies suggest that a strong identification with the dominant majority culture is the key element to succeed in the labour market. On the other hand, the degree of identification with the original cultural background seems less important.

## 1.5.2 Education

The level of education and the amount of ethnic group-specific versus general human capital of immigrants at arrival in a host country has significant implications on the pattern of cultural integration they will adopt. For instance, there is widespread evidence that more educated migrants have a higher propensity to intermarry with natives (see Lieberson and Waters, 1988; Schoen and Wooldredge, 1989; Sandefur and McKinnell, 1986; Meng and Gregory, 2005; Lichter and Qian, 2001; and Chiswick and Houseworth, 2008). Indeed Furtado (2006) proposes three mechanisms through which education could affect intermarriage: the cultural adaptability effect, the enclave effect and the assortative matching effect. The cultural adaptability effect captures the idea that educated people are better able to adapt to different customs and cultures. Therefore immigrants with higher human capital, having a better ‘technology’ for adapting, are more likely to marry natives. The enclave effect refers to the fact that educated immigrants are more likely to move out of their ethnic enclaves because they have better economic opportunities outside their group. They are, therefore, less likely to meet potential spouses of their own group and so, less likely to marry them. Finally the assortative matching effect reflects the fact that the gains from marriage are larger when the spouses’ education levels are similar. Given a costly search process, educated immigrants will be more willing to substitute the benefits of ethnic homogamy for assortativeness on the education dimension. Using 1970 US Census data, Furtado (2006) finds that controlling for the enclave effect, assortative matching is more important than cultural adaptability in explaining marriage choices of second-generation immigrants, though the empirical evidence supports both the cultural adaptability and assortative matching effects.

(p.29) Related to this, there are studies that have discussed the effect of education on identity formation. For instance, Zimmermann et al. (2006) study how human capital levels affect the ethnic self-identification of immigrants in Germany as well as their identification to the dominant majority culture. The results show that education acquired before immigration leads to a weaker identification with the dominant culture. On the other hand, human capital acquired after immigration does not affect the identification to the majority culture. Also, Constant et al. (2006) find that immigrants with higher education acquired prior to immigration are more likely to integrate than to assimilate, according to Berry’s categorization. Cultural integration patterns may also in turn affect the process of human capital accumulation of immigrant groups, especially for second-generation immigrants. The economics literature on oppositional cultures suggests, for instance, a negative relationship between strong ethnic identity and school performance; more specifically a trade-off between ethnic, and often racial, cohesion and academic achievement (see Akerlof and Kranton, 2002; Austen-Smith and Fryer, 2005; Fryer and Torelli, 2005; Pattacchini and Zenou, 2006). It is posited that social discrimination lowers the returns to education for minority individuals, thereby triggering a response by which minority students view educational achievement as an indication of acceptance of the dominant culture, and hence reject it in order to be accepted by their peers. The mechanism has been well illustrated in the USA with respect to black student communities, in which at times those who invest in education are reportedly harassed for ‘acting white’ and rejected by their peer group (Fordham and Ogbu, 1986). As noticed by Nekby et al. (2007), however, the US context of racial relationships that motivated the ‘oppositional culture’ hypothesis may not replicate well in other western societies. Different types of host country educational systems may interact differently with the cultural identity formation process of immigrants and minority groups. Several studies in cross-cultural psychology indeed find that children from integrated immigrant families are more motivated and more successful at school than those from assimilated families (Olneck, 1993). In their study of the identity of students with foreign backgrounds in Sweden, Nekby et al. (2007) also find that, controlling for early educational outcomes which may influence both self-assessed identity and subsequent education levels, cultural integration is associated with significantly higher levels of education achievements than cultural assimilation. These results hold for both first and second-generation immigrants. Cultural marginalization on the other hand is found to be associated with significantly lower levels of education.

(p.30) These results are consistent with the observation that rapid cultural assimilation of immigrants in certain dimensions serves to accelerate the process of human capital accumulation of children, while in other dimensions it may have the opposite effect. Indeed, for specific minority communities, strong attachment to traditional family values may well promote educational achievements. For instance, second-generation children may be more likely to live in households with both parents than their native counterparts (Jensen and Chitose, 1996) and a more stable family environment may in turn contribute to better academic achievements and to the economic success of the second generation. There are various ethnographic studies which support attributing the educational achievements of second-generation immigrants to close-knit family values. Waters (1996) describes, for instance, how, in New York City, the academic success of West-Indian teens differs from that of their Black American counterparts because of the more stable family structures of the former. Similar examples are reported for Vietnamese immigrants (Zhou and Bankston, 1996) or Punjabi Sikh communities (Portes and Zhou, 1994). On the other hand, it is also observed that immigrant households often have, on average, a larger number of children than do native households. This may delay the process of human capital investment of the second generation. As a matter of fact, immigrant family resources have to be spread over a larger number of individuals, creating a disadvantage for second-generation immigrants with respect to their native counterparts. In this respect, slower cultural integration along the fertility dimension leads to lower human capital accumulation of immigrant groups.

## 1.5.3 Social capital

Cultural integration patterns may also play an important role with regards to integration in other domains of public life, for example social relationships such as social networks, friendships, and local interactions with neighbours, between immigrants and natives, which are typically not mediated in markets. The socio-psychology literature on group conflict theory (Tajfel,1982) points out that these integration patterns might generate externality effects, typically negative. On the other hand, contact theory (Allport, 1954) emphasizes that these externalities may be positive, as repeated and multiple social interactions across group boundaries favour cultural integration.

The social capital literature suggests a link between cultural diversity and various measures of social capital. For instance, using individual-level data from US localities, Alesina and La Ferrara (2000, 2002) argue (p.31) that racial diversity and fractionalization leads to lower levels of trust and participation in voluntary associations. Putnam (2007) also finds a strong negative effect of ethnic heterogeneity on generalized trust, as well as on other indicators of social capital, in the United States. Issues might be more complex though. As argued by Nannestad (2008) macro-level studies of the relationship between ethnic heterogeneity and generalized trust have not yet turned out robust results: the studies by Delhey and Newton (2005), Paxton (2002), and Bjørnskov (2007) display notable differences on the estimated relationship between ethnic heterogeneity and trust levels. Consistently, empirical results from within-country studies of ethnic heterogeneity and generalized trust span the whole range of possible outcomes (Stolle et al., 2005; Pennant, 2005; and Anderson and Paskeviciute, 2006).

Uslaner (2006) argues that the level of local residential segregation across groups might be the most relevant dimension of cultural diversity which is negatively correlated with social capital. Using data from the Minorities at Risk (MAR) project of the Center for International Development and Conflict Management at University of Maryland, his analysis suggests that countries where minorities are most geographically isolated have the lowest levels of generalized trust.

From the point of view of immigrant integration patterns, however, these studies do not directly address the dynamics of social integration between groups which are initially culturally different. The study by De Palo et al. (2006) provides an indication of the determinants of immigrant social integration into the host country. This study relies on the European Community Household panel (ECHP), which provides data on the extent of social relations for both immigrants and natives, with particular information on the perceptions of immigrants regarding their own integration pattern rather than—as is typically the case in most opinion surveys—on natives’ attitudes toward migrants. The analysis shows that immigrants from non-EU origin countries, even after controlling for several individual characteristics, such as age, education, family size, and employment status, tend to socialize less than natives. Importantly, education has a significant impact on the type of social activities that immigrants undertake. More educated immigrants tend to relate somewhat less with individuals from their close neighbourhood than with the broader community.

## 1.5.4 Political economy

Cultural integration of immigrants may also be important at the level of the public policy sphere through, for instance, the way they identify (p.32) and participate in the host country political process. The importance of this issue is perhaps best illustrated by the recurrent debate on the viability and sustainability of multicultural welfare states in western societies (Banting, 1998; Banting and Kymlicka, 2003). In this respect, the comparison between the degree of redistribution in the American and the European political systems turns out to be central. While in the USA social expenditures reflect only about 15 per cent of GDP, they are about 25 per cent of GDP in most European countries. It has been argued that the lower redistributive character of the American political system is partly related to the fact that the American society is more culturally fragmented that the European ones (Alesina et al., 2001). The current immigration flows into Europe might lead to a more intense cultural fragmentation, which in turn might result in the reduction of social redistribution in European countries.

At the heart of the debate on the dynamics of welfare state systems in culturally diverse societies is a political economy equilibrium linking cultural diversity with preferences for redistribution and for the provision of public goods. Several mechanisms may be at work. First, cultural diversity may affect the sentiments towards national community, sentiments which underlie the social consensus for redistribution. It may also divide coalitions rooted in socio-economic class that traditionally sustained the welfare state and change the pattern of political alliances and coalitions for social policies. More specifically, erosion of political support for universal social programmes could derive from the fact that cultural minorities prefer private or communal provision of public services that better fit their cultural preferences. The focus on group specific public goods may also divide pro-welfare coalitions. Support for affirmative action, group rights, or greater autonomy for the expression of cultural differences may weaken links with majority community members and therefore undermine their support for welfare policies. Furthermore, divisions among different minority groups may hurt coalition formation processes. Most importantly, cultural majorities might also reduce their preferences for redistribution due to cultural diversity. Indeed, in political environments in which minorities challenge the mainstream culture, majorities might tend to oppose programmes that channel resources to communities they do not recognize as their own. This effect may be magnified when socio-economic differences and cultural differences are highly correlated (i.e. when the poor are mostly minorities and the minorities are mostly poor). In this case, in fact, economic redistribution is closely associated with cultural redistribution and the decisive voter (who is likely to be from the majority group) may prefer a reduced size of the welfare state.

(p.33) Cultural diversity may also weaken the mobilization of the working class and divide organized labour along ethnic and linguistic lines. This would reduce the political effectiveness and the organizational strength of trade unions, which, historically, have had a crucial role in the political support for welfare state institutions (Esping-Andersen, 1985 and 1990). Corroborating such a view, Stephens (1979) found, indeed, that during the expansion of the post-war welfare state, ethnic and linguistic diversity was strongly and negatively correlated with the effectiveness of labour organizations. Consistent with this discussion, the economic literature provides empirical evidence that cultural diversity (measured by ethnic or racial diversity) is associated with a reduced provision of public goods or redistribution, at the regional, city, or district level.9 The study by Poterba (1997) on the provision of public education in USA states suggests that older citizens are less inclined to spend on public education benefiting younger generations when these generations belong disproportionately to a different race. Vigdor (2004) also finds that the greater a community’s racial heterogeneity, the lower its rate of response to the 2000 Census form (this response is interpreted as a local public good, since the amount of federal funds allocated to the community depend on its response rate). While the conclusions from this literature cannot be applied directly to the question of support for European welfare state institutions, in particular because they relate mostly to racial rather than cultural diversity, they do suggest, however, that this issue is potentially important.

Shayo (2009) provides an interesting formal model of the endogenous interaction between social class or national identity formation and redistributive policies. The analysis builds on social psychology in exploiting the insight that an individual is more likely to identify with a group the more similar he is to that group and the higher the relative status of that group. The analysis highlights two interesting results: a relationship between national identification and income (the poor are more nationalist), and a link between preferences for redistribution and national identification (nationalists are for less redistribution, at a given income level). In turn the model implies that a more widespread sense of national identity is associated with less redistribution. Using data from the World Values Survey and the International Social Survey Program (ISSP 1995) for a large number of democracies, the paper provides some support for these implications and for the effect of within-class cultural (p.34) heterogeneity on the support for redistribution by the poor in European democracies.

An interesting recent literature addresses the specific issue of the preferences for redistribution of immigrants from the perspective of the observed persistence of cultural traits (Bisin and Verdier, 2010; Fernandez, 2010). For instance, using the separation and reunification of Germany as a natural experiment, Alesina and Fuchs-Schündeln (2007) find that those who lived in the former East Germany more strongly prefer redistribution after reunification. Similarly, Guiso et al. (2006) find that country-of-ancestry fixed effects are significant determinants of preferences for redistribution in the General Social Survey in the USA. Finally, Luttmer and Singhal (2008) use the three waves 2002/2003, 2004/2005, and 2006/2007 of the European Social Survey (ESS) to investigate how preferences for redistribution might have some purely cultural determinant. They find that the average preference for redistribution in an immigrant’s country of birth has a large and significant effect on his own preference for redistribution. These analyses suggest that immigrants tend to ‘export’ to the host country the preferences for redistribution they formed in the origin country. Passed on to second generations through cultural transmission, these inherited cultural values are likely to shape the political support for redistribution in the host countries significantly, at least as long as they are effectively activated through civic and political participation.

It is therefore natural in this respect to ask what do we know about civic participation of immigrants and if there is a cultural component of such behaviour? Using information from the European Social Survey and the World Values Survey for immigrants from 54 origin countries, Aleksynska (2007) investigates the factors that determine civic participation of immigrants and explicitly considers the issue of cultural transmission and assimilation of migrants with respect to civic participation. Active civic participation is defined as membership in trade unions and political parties, unpaid work for a party or any other organization or association, the signing of petitions and boycotting of certain products, and participation in lawful demonstrations. Cultural transmission is identified by relating participation rates of non-migrants in origin countries to the participation rates of those who migrate in host countries. At the same time, cultural assimilation is identified by comparing immigrant and native civic participation in the same country.10 (p.35) The paper documents several interesting empirical regularities. First of all, limited evidence is found for the transmission of participation across borders. Typically, migrants originating from industrialized and culturally more homogeneous countries tend to participate more. Second, the culture of the host country matters most: higher participation patterns among natives tend to induce immigrants to participate more.

# 1.6 Conclusion: what this book does

This book compares the patterns of cultural and economic integration across European countries and the USA. We document two main questions: (1) how do European countries differ in their cultural integration process, between themselves and with respect to the USA? (2) how is the cultural integration process related to economic integration?

## 1.6.1 Cultural and economic outcomes

Because we aim at providing a comprehensive picture of the cultural and economic integration process in a cross-country perspective, we look at the same set of cultural and economic outcomes, and compatibly with available data. The list of indicators we construct is inspired by the literature we have reviewed above.

To measure cultural integration, we focus on both objective indicators and self-reported attitudes and values. The main objective indicators of cultural integration we look at in the country chapters are:

• Family arrangement: education gap between partners, age gap between partners;

• Marital status: early marriage, cohabitation, marital status, divorce rate;

• Interethnic marriage rate;

• Fertility rate.

The main self-reported attitudes and values we focus on are:

• Language spoken at home;

• Self-identity, measuring whether the immigrant self-identified mainly with the host country or the country of origin;

• Religious intensity, measured by the frequency of praying.

(p.36) The main economic integration outcomes we report on include:

• Income;

• Educational attainment;

• Female labour force participation;

• Female and male employment rates.

## 1.6.2 Methodology to measure the integration process

In all country chapters, we propose two specifications to measure the integration process of immigrants.

Evolution of integration evolution between first and second-generation immigrants. This first specification compares the economic and cultural outcomes between the first and second generation of immigrants:

$Display mathematics$

where $β j$ and $γ j$ measures the impact of being a first-generation immigrant and a second-generation immigrant from country j relative to natives.11 First-generation immigrant and second-generation immigrant are dummies equal to 1 if the individual belongs to either group and zero otherwise. First-generation immigrants are defined as individuals who are foreign-born from country j and whose two parents are foreign-born. Second-generation immigrants are defined as immigrants who are born in the host country but whose parents are both foreign-born from country j. The reference group is represented by the natives in the host country, that is, individuals who are born in the country and whose both parents are also born in the country. The natives are always considered as the omitted group.

The comparison between $β j$ and $γ j$ thus measures whether the gaps in cultural and economic outcomes of immigrants relative to natives have evolved between first and second generation immigrants. This specification allows us to capture the integration process simply, as we have previously suggested in Figure 1.4. The origin at 0 represents the reference group of natives. The coefficient $β j$ on the vertical axis would reflect the gap between first generation immigrants and natives of the host (p.37) country. The coefficient $γ j$ on the horizontal axis would measure the gap between second-generation immigrants and natives of the host country.

The country chapters report for each outcome the four potential integration processes suggested above: ‘convergence’, ‘divergence’, ‘leapfrogging’, and ‘retraction’.

Evolution of integration evolution between younger and older cohorts of immigrants. This second specification allows us to explore further the integration process among cohorts. We use the same strategy as before but we distinguish the gap in cultural and economic outcomes between different birth cohorts within each wave of immigration.

$Display mathematics$
where $β j , k$ is the impact of being first-generation immigrant from country j and belonging to the birth cohort k, relative to the natives.

The country chapters distinguish mainly between two cohorts, those younger or older than 30-year-olds, and focus on the cohort evolution within the first-generation immigrants. This specification provides the same simple illustration of the integration process as in Figure 1.4 above, but where the horizontal axis represents gap between the natives and the younger cohort, and the vertical axis represents the gap between the natives and the older cohorts.

## 1.6.3 Control variables

The baseline controls are the dummies associated with the country of origin of first and second generation, or the cohorts of foreign born, with reference to the natives (omitted group). In addition, all the country chapters include a baseline vector X of controls, including gender, age, and education. Those are the co-variates available in all the country surveys. In addition to the baseline regressions, the country chapters explore further the role of additional controls, whenever available, such as the time spent in the host country or whether immigrants have been educated in the host country.

# 1.7 Caveats

The first caveat relates to the choice of the countries covered by the book. The selection of the European countries is based on two main (p.38) criteria. The first is to gather European countries with sharp enough differences in their integration models and for which the question of cultural integration of immigration lies as the heart of the agenda. The second criterion is the availability of representative national databases combining information on both objective and subjective outcomes of cultural and economic integration. This book thus does not cover all the European countries. The conclusion will enlarge the cross-country comparison by using another database, the European Social Survey. We also document the results for the USA.

The second issue relates to the econometric specification. In order to gather descriptive data from heterogeneous national surveys, this book has to propose a simple econometric specification that can be replicated in all countries. This is a clear trade-off between providing in-depth analysis of endogeneity and omitted variables, but for a small set of countries, or enlarging the coverage of European countries with replicable estimations.

This book does not identify causal links between cultural and economic integration, and we are not aware of any research article that provides such a link so far. Besides, it might well be the case that identification is impossible due to the existence of potential multiple equilibria, as stated above. For instance, an increase in the number of immigrants can shift the preferences and shape institutions, say segregation at schools, which in turn affect the educational achievement of immigrants. But another equilibrium might appear. As the level of education of the country improves, so the perception of immigrants and institutions will change, with less segregation at schools, improving the educational achievement of immigrants. In this context, it is hopeless to identify a causality between institutions of cultural or economic integration of immigrants.

Yet, in the concluding chapter, we use the European Social Survey to check the robustness results of the country chapters. First, we can control for country of residence fixed effects that could drive the cultural and economic integration processes. Second, the information given by the country of origin fixed effects allows us to control partly for the sample composition of immigrants. Let’s say, for instance, that we are interested in comparing the cultural integration of immigrants of Maghreb origin across European countries. This analysis is likely to be biased by the fact that all Maghreb immigrants do not come from the same country of origin, and the inherited specificities from the home country could determine the economic and cultural integration process of immigrants in their destination country. The cross-country dataset allows mitigating such biases.

# (p.39) 1.8 Main results

We sum-up the main results of the different country chapters and of the cross-country comparison based on the European Social Survey.

## 1.8.1 France

The chapter on France estimates the integration process by combing three main surveys: the French Labour Force Survey 2005–2007, which provides for the first time the country of origin of the parents, the French Family Survey 1999, which report detailed data on the family structure of immigrants, and Histoire de Vie 2003 that reports attitudes and values of a representative sample of immigrants.

Those surveys provide a focus on the integration process of six main groups of immigrants coming from: Maghreb, Sub-Saharian Africa, Southern Europe, Northern and Eastern Europe, and Asia.

The chapter shows substantial heterogeneity in the cultural and economic indicators across first-generation immigrants. In particular, first-generation immigrants from Maghreb and Africa display significant cultural and economic gaps with natives regarding marriage at first age, age and education gap between spouses, or fertility rates. But we find evidence that in almost all dimensions and for all groups, there is a fast integration process between first and second-generation immigrants. The rate of cultural and economic integration is faster for some variables than others. It is religion, family arrangements, and endogamy that show the slowest rate of convergence, in particular among immigrants from Maghreb. Second-generation immigrants from Maghreb also display a persistent penalty in terms of employment. This seems a French particularity.

## 1.8.2 Germany

The analysis for Germany is based on the German Socio-Economic Panel (GSOEP) 2005–2007. This survey cover a representative sample of 20,000 individuals, with a wealth of information on cultural, social, and economic aspects of immigrants.

The main countries of origin of the immigrants covered in the survey are: Turkey, Ex-Yugoslavia, Greece, Italy, Spain, Poland, and Russia.

This chapter suggests an important heterogeneity in cultural outcomes for first-generation immigrants, but a steady convergence process among second-generation immigrants. For instance, fertility rates, age (p.40) at first child and female labour force participation differ significantly between natives and first-generation immigrants, but differences vanish or at least diminish for later immigrant generations. Second-generation immigrants also report higher levels of language proficiency and of identification with Germany than members of their parental generation.

Regarding the particular case of the Turks, this analysis shows that comparison by generation is crucial when making statements about the integration process of ethnic groups. Turks differ in various ways from natives and also from other immigrant groups. They are more likely to be married in general, more often married at young ages, and often have more children than the average German person. They report the lowest level of political interest and lower levels of life satisfaction than other immigrant groups. But second-generation Turks show higher intermarriage rates, similar behaviour as natives in terms of age at first marriage, age at first child and number of children, and report better German language proficiency as well as greater identification with German identity.

## 1.8.3 Italy

The analysis is based on the Italian Labour Force Survey 2005–2007, which provided for the first time in 2005 onwards information on the country of birth of the parents. The six main origins of the immigrants are North Europe, South and East Europe, Africa, Asia, North and Central America, and South America.

This chapter suggests a more pronounced heterogeneity in cultural and economic integration among first-generation immigrants coming from: North and Central America, and from South America. But interestingly, second-generation immigrants from those countries no longer display significant differences with natives.

## 1.8.4 Spain

The analysis for Spain is based on two main databases: the 2007 Labour Force Survey (‘Encuesta sobre la Población Activa’ or LFS) and the 2007 National Immigration Survey (‘Encuesta Nacional de Inmigrantes’ or NIS), both conducted by the Spanish Statistical institute. The new National Immigration Survey sampled the foreign-born population residing in Spain in 2007 with the specific aim of providing insights on migrants’ experiences in Spain.

Those surveys distinguish four main origins of immigration: Latin America, Morocco, other Maghrebian countries, and Eastern Europe.

(p.41) This chapter shows that Latinos—the group with the shortest cultural distance to Spanish social norms—appear very similar to natives in most of the economic and cultural outcomes. In contrast, Moroccans and individuals from other Muslim countries still display large gaps along several dimensions. But the cultural and economic gaps for Moroccans and individuals from other Muslim countries is shrinking fast with the time spent in the host country.

## 1.8.5 Sweden

The data used for Sweden comes from the registered information at Statistics Sweden (SCB) on the entire working age population (16–65 years of age) residing in Sweden in 2005. Included in the data is rich individual information on personal and demographic characteristics, education, employment, and income. In addition, detailed information is available on country of birth and migration dates for the foreign-born portion of the population as well as parents’ country of origin for the entire sample.

The survey distinguishes the following origins of immigration: Nordic, West Europe (non-Nordic), East Europe (non-Nordic,), South America, North/Central America, Asia, and Africa.

This chapter shows a large degree of social integration between natives and immigrants in terms of cultural and economic outcomes. The integration process is slower for the sample of second-generation immigrants with homogenous national backgrounds, in particular in terms of partnership patterns, female employment rates, and female education levels.

## 1.8.6 Switzerland

Data for Switzerland stems from the Swiss Census 2000 and the Swiss Household Panel (SHP) 2004–2005. The main origins of immigrants are: Western Europe, Southern Europe, Eastern Europe, Africa, Turkey-Maghreb, Latin America, Asia, and South-Central Asia.

The chapter shows that cultural integration processes, which are at work in various ways in the different groups, contribute to overall convergence. The most striking and lasting differences we can observe across groups do not relate to educational achievement, religious or political attitudes, but to gender-related attitudes and even more to gender-related behaviours. Differences are more pronounced in endogamous couples in general, specifically for women from South and Central Asia, from Turkey, the Middle East, and Maghreb.

## (p.42) 1.8.7 United Kingdom

The analysis of integration in United Kingdom is mainly based on the Labour Force Survey (LFS) for the years 2000–2008 inclusive. The LFS contains information on country of birth, but no information on country of parental birth for the UK born. This means that it is impossible to identify second-generation immigrants. Instead, this chapter uses self-defined ethnicity as a measure of being a second (or subsequent) generation immigrant. The analysis of the descendants of immigrants is restricted to ethnic minorities.

The main immigrant groups in this chapter are: Indian, Pakistani, Bangladeshi, Black Caribbean, Black African, and Chinese.

The chapter finds significant differences across ethnic minorities in cultural and economic outcomes, but a striking common pattern that emerges is the extent to which the behaviour of UK-born ethnic minorities generally lies between that of white natives and the foreign-born from that community. This indicates a general pattern of cultural assimilation. The rate of cultural assimilation is faster for some variables than others—it is perhaps religion that shows the slowest rate. But overall there are very powerful forces that are acting to change the behaviour of immigrant communities once they are in United Kingdom.

## 1.8.8 United States

The analysis of the integration process in the United States draws on very detailed information from the Census, starting from 1900 onwards and covering all the countries of origin. The Census allows a unique look at the evolution of the integration process of different minorities since the early twentieth century.

The chapter shows that overall there has been little change in cultural immigration over the past century. But some important changes over time, and differences across groups, emerge. Members of the largest single immigrant group of the early twentieth century, those born in Italy, in general were much less assimilated upon arrival than members of the largest group of the early twenty-first century, those born in Mexico. Whereas one-third of newly arrived Mexicans spoke no English in recent years, nearly three-quarters of newly arrived Italians could not speak English in 1910. The rate of cultural integration over time has declined, however. The chapter shows that this decline in the rate of immigration is largely associated with the rise of the status of ‘illegal immigrant’ in the United States. (p.43)

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## Notes:

(1) The research leading to there results for Yann Algan has received funding from the European Research Council under the European Community’s Sweath Framework Programme (FP7/2007–2013)/ERC grant agreement number 240923.

(2) Defined broadly to include non-market interactions as well.

(3) In Lazear (1999), the fractions pA and pB reflect the proportions of people that speak, respectively, language A and language B. Therefore, bilingual individuals belong to both cultures and pA + pB 〉1.

(4) A rapidly emerging economic literature on oppositional cultures includes, for instance, Ferguson (2001), Fryer (2004), Austen-Smith and Fryer (2005), Fryer and Torelli (2005), Battu et al. (2007), Battu and Zenou (2010), Darity et al. (2006), Pattacchini and Zenou (2006).

(5) See for instance MacLeod (1987) and Willis (1977).

(6) See for instance (Berry, 1980, 1984, 1997; Phinney, 1990; Phinney et al., 2001).

(7) For instance, education choices have been studied by Pattacchini and Zenou (2004); marriage choices within ethnic and religious groups have been specifically discussed by Bisin-Verdier (2000) and Bisin et al. (2004). Other applications incorporating identity formation and oppositional cultures include Sáez-Martí and Zenou (2005) and Bisin et al. (2009). The role of horizontal socialization and peer effects is also discussed in Sáez-Martí and Sjögren (2005).

(8) Those are: (1) language (speak German and/or the language of the origin country); (2) visible cultural elements (type of preferred food, media, and music), (3) ethnic self-identification; (4) ethnic networks structures (i.e. origins of closest friends); and (5) future citizenship and residency plans.

(9) Alesina and La Ferrara (2004) provide a good survey of this literature.

(10) The econometric issue with the possible selection of immigrants is somewhat accounted for by a procedure which matches immigrants to otherwise similar natives and compatriots who did not migrate.

(11) Note that this specification assumes that the birth cohorts and other regressors have the same effect for all countries of origin.