Abstract
We analyze the determinants of the internal and foreign migrants’ decision regarding their employment status and examine the importance of second-language proficiency in bilingual economies. When arriving at a bilingual territory, migrants must decide if it is worth to learn the second official language. If one of the languages predominate in economic activity, there are less incentives for migrants to make the effort of learning the second language. However, if a local language contributes to build or strengthen a regional identity, learning it could help immigrants’ immersion in the receiving region. We use the Spanish Census in 2001, which exceptionally asked all participants about their knowledge of the co-official language in the bilingual regions. Our results show that second-language proficiency reduces the probability of being unemployed and stimulates self-employment. e impact becomes stronger among foreign migrants without Spanish as a first language and migrants arriving after primary school and living in non-urban areas.