On the Cost of Being a Muslim

It is widely recognized that immigrants to Europe from Turkey, Morocco, and Arab countries have higher unemployment than other immigrants and native workers.  Even if they manage to get a job, these immigrants are often paid less for the same human capital.  We adopt here a metaphor from Paul Siegel’s classic 1965 article, “On the Cost of Being a Negro” , showing that white-nonwhite differentials in earnings at most occupational and educational levels interacted with living in the South of the US to put a dollar figure on labor market discrimination.  This paper uses a similar method to estimate the cost of being a Muslim, or more specifically, an immigrant from the Middle East and North Africa, in selected European countries, using harmonized LIS (and EULFS) data. Correcting for selectivity into employment (Van Tubergen, Maas, and Flap 2004), the effect of being a Muslim on wage and salary income is estimated with a dummy variable for national origin, after controlling for education, hours, occupation, and other standard productivity indicators.  To be sure, this specification misses much religious, ethnic, and linguistic variation among these immigrants – Lebanese Christians, Egyptian Copts, Turks, Kurds, and Iranians may not be Arabic-speaking Muslims and may have in fact emigrated to Europe precisely because they were minorities in their regional homelands.  But it  provides a rough estimate of labor market disparities and earnings inequality  that can be compared across countries of the European Union and the United States (where religion is rarely available).