Labor Market Experience in a “Pseudo-Home” Country: Turkish Immigrants in Northern Cyprus

Abstract

In this study we analyze the labor market experiences of Turkish immigrants in Northern Cyprus. Northern Cyprus presents a unique example for Turkish migrants, as many traditional obstacles (language barrier, cultural and ethnic differences and non-transferability of human capital) for immigrant laborers are not applicable since Turkish immigrants have ethnic and cultural similarities to native citizens and Turkey is considered the “motherland” of Northern Cyprus. Nonetheless, significant differences between Turkish immigrants and natives in regard to the labor market exist in Northern Cyprus. Using data from the period 2004–2011, we find that although occupational attainment of immigrants has improved in favor of high-skilled occupations, the average wage gap has not decreased significantly. The statistical estimations reveal that Turkish immigrants earn, on average, 25 percent less than natives in the private sector. Furthermore, half of this gap cannot be explained by differences in individual characteristics and ethnic discrimination.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes on Contributors

Mustafa Besim is Associate Professor of Economics at the Eastern Mediterranean University, where he also serves as Acting Dean of the Faculty of Business and Economics. His fields of specialization are public finance, economic development and investment appraisal. He has published on the Turkish Cypriot economy with topics ranging from underground economies, taxation, productivity and the future of the Turkish Cypriot economy, to the recent global financial crises.

Tufan Ekici is a quantitative social scientist with a background in economics. His research interests include the application of statistical methods to the analysis of various issues in behavioral sciences. He also worked as a risk analyst in the private sector building behavioral scorecards for credit card and mortgage portfolios. He has been a lecturer at the Middle East Technical University Northern Cyprus Campus since 2006.

Fatma Güven Lisaniler is Associate Professor of Economics at Department of Economics of Eastern Mediterranean University, Famagusta. As an economist, she has specialized in economic development with special reference to labor market issues. She has publications in academic journals and chapters in books on Cyprus problem, migrant workers and gender equality. She has a book; Assessing the Status of Women: A step towards equality. She is the editor of Journal for Women's Studies Kadin/Woman 2000.

Notes

1. SPO, 1996 Census of Population.

2. SPO, “2011 Census of Population.”

3. Güven-Lisaniler and Rodriguez, “Social and Economic Impact on North Cyprus,” 435–48; Faiz, “Population Issue in North Cyprus,” 75–187; Hatay, “Political Integration of Turkish Settlers.”; and Hatay, “The Problem of Pigeons,” 145–71.

4. Chiswick, “Effect of Americanization on Earnings,” 897–921.

5. Güven-Lisaniler, Rodriguez, and Uğural, “Migrant Sex Workers and Regulations,” 79–91; Ibid., “Human Rights Migrant Workers,” 435–48; Güven-Lisaniler, Assesing the Status of Women.

6. Güryay and Şafaklı, “KKTC'de Kaçak İşgücünün Etkileri,” 35–45; Mehmet et al., “Labour Mobility and Convergence,” 41–67; Besim, Ekici, and Jenkins, Approach to Measure Informal Employment.

7. Karacaoğlu and Reyhanoğlu, “‘Kıbrıs Türkü’ ve ‘Türkiyeli’ Ayrımı,” 145–76.

8. Çolak, Identity and Citizenship.

9. See note 4 above.

10. Hatay, Turkish “Settlers” in Northern Cyprus.

11. Kurtulus and Purkis, Kuzey Kıbrıs'ta Türkiyeli Göçmenler.

12. Cohen, The New Helots; Massey et al., “Theories of International Migration,” 431–66; King, “New Map of European Migration,” 89–106.

13. Todaro and Maruszko, “Illegal Immigration and US Reform,” 101–14; Borjas, Friends or Strangers.

14. Taylor, Differential Migration Networks; Stark and Bloom, “New Economics Labour Migration,” 173–78; and Stark, The Migration of Labour.

15. Harris and Todaro, “Migration, Unemployment, Development,” 126–42.

16. Massey et al., see note 12 above.

17. Portes et al., Labor, Class, International System.

18. Borjas, “Immigrant and Emigrant Earnings,” 21–37; Chiswick, Economic Progress of Immigrants, 357–99.

19. See note 4 above.

20. Grand and Szulkin, “Permanent Disadvantage Gradual Integration,” 37–64.

21. See Long, “Effect of Americanization on Earnings,” 620–29; Borjas, “The Economics of Immigration,” 1667–717; Chiswick and Miller, “Endogeneity Between Language Earnings,” 246–88; Kee, “Native Immigrant Wage Differentials,” 302–17; Nielsen et al., “Qualifications, Discrimination, Assimilation,” 855–83; Antecol, Kuhn, and Trejo, “Assimilation via Prices Quantities,” 821–40; Berman, Lang, and Siniver, “Language Skill Complementarity,” 265–90; Liu, Zhang, and Chong, “Occupational Segregation Wage Differentials,” 395–413; and Aldashev, Gernandt, and Thomsen, “Immigrant Wage Gap Germany.”

22. Stark and Bloom, “The New Economics of Labor Migration,” 173–8; Borjas, “Immigrant and Emigrant Earnings,” 21–37.

23. Chiswick, “The Economic Progress of Immigrants,” 357–99.

24. Borjas, “Assimilation and Changes in Cohort Quality,” 201–45; Denny, Colm, and Maurice, Discrimination in Immigrant Earnings.

25. Kanas and van Tubergen, “Returns to Origin-Country Human Capital,” 130–41.

26. Demireva, “New Migrants in the UK,” 637–55.

27. Kalter, “Labour Migration from Poland to Germany,” 555–69; and Luthra, “Explaining Ethnic Inequality,” 1095–107.

28. Diehl and Liebau, Turning Back to Turkey.

29. Snel, Burgers, and Leerkes, “Class Position of Immigrant Workers,” 1323–42.

30. Seifert, “Occupational and Social Integration,” 417–36.

31. Konur, Kıbrıs Türkleri; Erdentuğ, Kıbrıs ve Türkiye Toplumlarının Birliği and Beratlı, Kıbrıslı Türkler'in Kökenleri.

32. Güven, 1974 Öncesi ve Sonrası and Ismail, TC-KKTC İkili Anlaşma.

33. Bozkurt, “IMF of Northern Cyprus?,” 83–105.

34. Immigrants from other countries represent less than 1 percent, 4.7 percent and 7.5 percent of the population, respectively in 1996, 2006 and 2011 censuses. Given that the other immigrants come from countries with very diverse characteristics and are small in numbers, the random samples collected by the government offices do not have enough representative observations from these nations. Therefore we do not focus in this paper on immigrants from countries other than Turkey due to lack of data.

35. See Hatay, “The Problem of Pigeons,” 145–71; Kurtuluş and Purkis, Kuzey Kıbrıs'ta Türkiyeli Göçmenler for an extensive review of the history of Turkish migration in North Cyprus.

36. Kurtuluş and Purkis, Kuzey Kıbrıs'ta Türkiyeli Göçmenler, 123.

37. Keser, “Kıbrıs'ta Göç Hareketleri,” 103–28; Hatay, Turkish “Settlers” in Northern Cyprus; Kurtuluş and Purkis, Kuzey Kıbrıs'ta Türkiyeli Göçmenler.

38. Hatay, Turkish “Settlers” in Northern Cyprus; Kurtuluş and Purkis, Kuzey Kıbrıs'ta Türkiyeli Göçmenler.

39. Economic Cooperation Agreements (1986), Labour Force Agreements (1987) and the Regulation (1991) that allowed Turkish citizens to enter North Cyprus with identity card instead of passports, Kurtuluş and Purkis, Kuzey Kıbrıs'ta Türkiyeli Göçmenler, 123–8.

40. Mehmet et al., “Labour Mobility and Convergence,” 41–67.

41. Besim and Jenkins, Informal but not Insignificant.

42. Taymaz et al., İşgücü Piyasasının Etkinliğinin Tespiti.

43. The term “migrant worker” refers to a person who is to be engaged, is engaged or has been engaged in a remunerated activity in a state of which he or she is not a national (UN, “Learning to Live Together”: Article 2).

44. Oaxaca “Male-Female Wage Differentials,” 693–709. We provide the details of this method in Appendix.

45. Borjas, “Changes in Cohort Quality,” 201–45.

46. Algan et al., “First and Second-Generation Immigrants,” F4–30.