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Table 6 Weighted OLS and FE estimates comparing the impact of diversity on wages for different groups. Dependent variable: log of weekly wages

From: The regional impact of cultural diversity on wages: evidence from Australia

Explanatory variables Australian-born sample Migrant sample Movers Non-movers
OLS FE OLS FE OLS FE OLS FE
(1) (2) (3) (4) (5) (6) (7) (8)
Diversity index 0.650*** 0.340* 0.436*** −0.318 0.639*** 0.180 0.607*** −0.089
  (0.087) (0.180) (0.127) (0.320) (0.086) (0.138) (0.127) (0.510)
Demographic controls Yes Yes Yes Yes Yes Yes Yes Yes
Human capital controls Yes Yes Yes Yes Yes Yes Yes Yes
Time dummiesa Yes Yes Yes Yes Yes Yes Yes Yes
Individual effects No Yes No Yes No Yes No Yes
Observations 16,756 16,410 3400 3296 12,284 12,044 7872 7662
Adjusted R-squared 0.565 0.318 0.569 0.376 0.561 0.366 0.574 0.339
First stage for diversity index         
Predicted diversity index 0.599*** 0.260*** 0.664*** 0.292*** 0.573*** 0.338*** 0.679*** −0.162***
  (0.018) (0.030) (0.038) (0.098) (0.020) (0.035) (0.027) (0.039)
Instrument tests         
Underidentification testb 512.43 56.74 99.50 6.98 350.60 68.57 290.56 16.87
p value 0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
Weak identification testc 1113.17 75.02 312.33 8.92 846.59 95.97 628.93 17.24
  1. Values are estimated for the HILDA wave 4–11 respondents aged 16–45 years. Robust standard errors are in parentheses and are adjusted for clusters by individuals. The reported sample sizes differ from the original (n = 44,634) due to sample weighting and lagging. Demographic controls include age and age-squared in all models, plus gender and marital status in the OLS models. Human capital controls include education, weekly hours worked, and job tenure, in all models, plus English language skill in OLS
  2. Significance values indicate *p < 0.1; **p < 0.05; ***p < 0.01
  3. aTime dummies are partialled out in the FE models
  4. bBased on the Kleibergen-Paap rk LM statistic
  5. cBased on the Kleibergen-Paap rk Wald F statistic: Stock-Yogo weak ID test critical value maximal IV sizes range as follows: 16.38 (10 %), 8.96 (15 %), 6.66 (20 %), and 5.53 (25 %)