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New Zealanders can cross borders freely, work and live in Australia indefinitely thanks to the Trans‐Tasman Travel Agreement. This paper uses a recently developed decomposition method to decompose the weekly wage gap at various quantiles on the wage distribution between New Zealand‐born (NZ‐born) and Australian‐born workers, and between NZ‐born workers, migrants from other English speaking countries (OESC), and from non‐English speaking countries (NESC) to determine how free and regulated migration influences migrants' performance in the Australian labour market. We found that NZ‐born workers earned higher weekly wages than both Australian‐born and NESC workers but earned lower wages than OESC migrants. Differences in endowment were primarily responsible for the wage gaps between NZ‐born and Australian‐born workers and between NZ‐born and OESC migrants. However, differences in returns to worker and job characteristics are mainly responsible for the wage gap between NZ‐born and NESC migrants. [ABSTRACT FROM AUTHOR]

This paper examines the impact of homogamy on the distribution of household income in New Zealand at the national level and across different sized cities. We focus on homogamy by age, education, hours worked, employment status, and migration status. We present a new index of homogamy that takes account of maximum potential homogamy. Our index is less sensitive to categories with small population shares than the commonly used concentration ratios. We compare the inequality impact of actual matching with that of randomized matching by means of the additional randomization method. Contrary to public perception, homogamy of the highly educated has declined relative to random matching. Nonetheless, homogamy has had an inequality‐increasing impact on the distribution of income and this effect has grown over time: from around 5% of the mean log deviation (MLD) measure of income inequality in 1986 to 16% in 2013. Allowing for simulated labor supply responses reduces this effect by less than 1%. Spatially, the effect of homogamy is larger and increases more in metropolitan areas than in other urban areas. In Auckland, New Zealand's largest city (around a third of the population), homogamy accounted for a fifth of MLD inequality by 2013, up from 6% in 1986. Educational homogamy plays the biggest role in this process, but the effects of hours worked, employment status and migration status are relatively important too. Homogamy by age has little effect on income inequality. Using the Gini index as an alternative inequality measure yields similar results. [ABSTRACT FROM AUTHOR]