The conditional relationship between English language proficiency and earnings among US immigrants

Using the 2000 US census data for immigrants of twenty language groups resided in metropolitan areas, we test the hypothesis that the rate of returns (in earnings) to English proficiency is not constant but varies with the language environment (as defined by group size, segregation, linguistic heterogeneity and inequality) in which immigrants are embedded. Results from our hierarchical model indicate that while an increase in the size and segregation of the language group diminishes returns to English proficiency, a rise in linguistic heterogeneity and inequality in the metropolitan area has the opposite effects. This study expands the scope of the previous studies by identifying conditions under which returns to English proficiency among immigrants are modified by a set of contextual factors often overlooked.