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Immigration Reform: The Effects of Employer Sanctions and Legalization on Wages

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  • Cobb-Clark, Deborah A
  • Shiells, Clinton R
  • Lowell, B Lindsay

Abstract

The Immigration Reform and Control Act of 1986 (IRCA) represents an attempt to use labor-market regulation to control illegal migration into the United States by imposing fines on employers who hire unauthorized workers. Sanctions lower wages directly because they act as a tax on hiring additional workers. In addition, IRCA legalized many longtime illegal aliens. Legalization affects wages by changing the relative supply of authorized and unauthorized workers. This study estimates IRCA's impact on wages of manufacturing production workers in metropolitan areas and finds small but statistically significant effects: sanctions lower wages, while legalization raises them. Copyright 1995 by University of Chicago Press.

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Bibliographic Info

Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 13 (1995)
Issue (Month): 3 (July)
Pages: 472-98

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Handle: RePEc:ucp:jlabec:v:13:y:1995:i:3:p:472-98

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Web page: http://www.journals.uchicago.edu/JOLE/

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Cited by:
  1. Emmanuelle Auriol & Alice Mesnard, 2012. "Sale Of Visas: A Smuggler's Final Song?," CReAM Discussion Paper Series 1217, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  2. Julie Phillips & Douglas Massey, 1999. "The new labor market: Immigrants and wages after IRCA," Demography, Springer, vol. 36(2), pages 233-246, May.
  3. Amuedo-Dorantes, Catalina & Bansak, Cynthia, 2011. "The Impact of Amnesty on Labor Market Outcomes: A Panel Study Using the Legalized Population Survey," IZA Discussion Papers 5576, Institute for the Study of Labor (IZA).
  4. Carlo Devillanova & Francesco Fasani & Tommaso Frattini, 2014. "Employment of Undocumented Immigrants and the Prospect of Legal Status: Evidence from an Amnesty Program," CReAM Discussion Paper Series 1415, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  5. Pia M. Orrenius and Madeline Zavodny, 2012. "The Economic Consequences of Amnesty for Unauthorized Immigrants," Cato Journal, Cato Journal, Cato Institute, vol. 32(1), pages 85-106, Winter.
  6. Stark, Oded & Jakubek, Marcin, 2012. "Employer sanctions, and the welfare of native workers," Economics Letters, Elsevier, vol. 117(3), pages 533-536.
  7. Gil S. Epstein & Odelia Heizler, 2007. "Illegal Migration, Enforcement and Minimum Wage," CReAM Discussion Paper Series 0708, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  8. Pagan, Jose A., 1998. "Employer sanctions on hiring illegal labor: An experimental analysis of firm compliance," Journal of Economic Behavior & Organization, Elsevier, vol. 34(1), pages 87-100, January.
  9. Julie L. Hotchkiss & Myriam Quispe-Agnoli & Fernando Rios-Avila, 2012. "The wage impact of undocumented workers," Working Paper 2012-04, Federal Reserve Bank of Atlanta.
  10. Woodland, Alan D. & Yoshida, Chisato, 2006. "Risk preference, immigration policy and illegal immigration," Journal of Development Economics, Elsevier, vol. 81(2), pages 500-513, December.
  11. Carlo Devillanova & Francesco Fasani & Tommaso Frattini, 2014. "Employment of Undocumented Immigrants and the Prospect of Legal Status: Evidence from an Amnesty Program," Development Working Papers 367, Centro Studi Luca d\'Agliano, University of Milano, revised 26 Jun 2014.

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