Social Exclusion of Nicaraguans in the Urban Metropolitan Area of San Jose, Costa Rica

The large number of recent Nicaraguan immigrants to Costa Rica during the 1990s have outcomes that are worse than Costa Ricans in many dimensions. Moreover, Nicaraguans are geographically and occupationally concentrated. This paper documents the magnitude of Nicaraguan group effects and examines the consistency of the evidence with the main explanations for social exclusion. The results -and especially the high levels of labor market participation - suggest that Nicaraguans, like other immigrant groups that have chosen to migrate, are vulnerable rather than excluded. There is some evidence that the mechanisms leading to changes in legal status, transferability of skills, and discrimination could explain some of Nicaraguans’ worse outcomes and type of integration. While there is not a strong relationship between neighborhood characteristics and outcomes once other controls are included, the current housing policy of the Costa Rican government makes it likely that geographic concentration of Nicaraguans will continue to increase, which could lead to a negative relationship between concentration and outcomes in the future.