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Integration, Social Networks and Economic Success of Immigrants: A Case Study of the Turkish Community in Berlin

Authors


  • This paper is part of a wider research led by the second author and funded by the Nuffield Foundation concerning the economic behavior and integration of Turkish households in Berlin. We would like to thank the Nuffield Foundation for their financial support. We also thank Oded Stark, Ira N. Gang, Uma Kothari, Sam Hickey, Tanja Müller, Thankom Arun, Ingrid Tucci, Natalia Weisshaar and the participants of the DIW Research Seminar, IZA Summer School and World Economic Congress as well as the editors of this journal and the anonymous referees for their helpful comments. We are grateful to the research assistants Zeycan Yesilkaya, Fatma Goksu, Cagri Kahveci, Beyhan Yildirim, Deniz Erkan, Rut-Maria Gollan and Alper Yenilmez for their vigorous and excellent work on interviews and data entry.

SUMMARY

The observation that some immigrants choose not to integrate into the host society has caused political controversies across European states. This paper hypothesizes that immigrants can exploit social networks of different scales in order to substitute for costly integration. Using a novel dataset of Turkish households in Berlin, which was specifically collected for this analysis, we investigate the determinants of integration as well as the impact of integration and networks on households' economic success. We find evidence that integration promotes income even after accounting for potential endogeneity bias. Using endogenous switching regression model, we test whether local ethnic networks can be successfully used to generate household income. In line with the view that there is a trade-off between integration and the establishment of ethnic contacts, we find that local ethnic and familial networks increase the income of unintegrated migrants, while transnational networks decrease it. Moreover, education is more income improving for integrated than non-integrated immigrants and remaining closely integrated within their own ethnic group is more economically advantageous for poorer households. These results provide evidence that integration is the rational strategy for better-off immigrants while it may be too costly for poorer immigrants.

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