Language skills and earnings among legalized aliens

This paper uses the data on males and females from the 1989 Legalized Population Survey (LPS), a sample of aliens granted amnesty under 1986 Immigration Reform and Control Act, to analyse English language proficiency and earnings. We use a model of English language proficiency that is based on economic incentives, exposure and efficiency variables that measure the costs and benefits of aquiring English language skills, Consistent with the model, in this sample of former illegal aliens, English language proficiency is greater for those with more schooling, who immigrated at a younger age: who have been in the United States longer, with a more continous stay, and who have less access to other origin language speakers where they live. Earnings are higher by about 8% for men and 17% for women who are proficient in both speaking and reading English, compared to those lacking both skills. JEL classification: J24, J31, J61, J15.