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Legalization and the Economic Status of Immigrants

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  • Silvia Helena Barcellos

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    Abstract

    This paper investigates the impact of legalization on the economic outcomes of the legalized population. It uses a natural experiment caused by the 1986 Immigration Reform and Control Act (IRCA) which gave amnesty for undocumented immigrants who could prove continuous residence in the U.S. after January 1, 1982. The arbitrary cutoff date on the eligibility criteria causes a discontinuity in the relationship between the year of immigration and the probability of being legal. This paper uses this discontinuity to identify the causal impacts of legalization on immigrants' outcomes. Regression discontinuity and difference-in-differences estimates show that immigrants eligible for the policy have a significantly higher probability of being naturalized citizens than those who were not. Legalization is also found to have a positive and significant effect on wages, a negative effect on the probability of working in a traditionally illegal occupation, and no significant effect on geographical mobility. The analysis for different demographic groups confirms such conclusions and shows that the estimated effects of legalization are larger for low-educated Latin American immigrants, the group that was disproportionably affected by the policy.

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    File URL: http://www.rand.org/content/dam/rand/pubs/working_papers/2010/RAND_WR754.pdf
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    Bibliographic Info

    Paper provided by RAND Corporation Publications Department in its series Working Papers with number 754.

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    Length: 48 pages
    Date of creation: Mar 2010
    Date of revision:
    Handle: RePEc:ran:wpaper:754

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    1. Kristin Butcher, 1990. "Black Immigrants to the United States: A Comparison with Native Blacks and Other Immigrants," Working Papers 648, Princeton University, Department of Economics, Industrial Relations Section..
    2. Francisco L. Rivera-Batiz, 1999. "Undocumented workers in the labor market: An analysis of the earnings of legal and illegal Mexican immigrants in the United States," Journal of Population Economics, Springer, vol. 12(1), pages 91-116.
    3. George J. Borjas & Bernt Bratsberg, 1994. "Who Leaves? The Outmigration of the Foreign-Born," NBER Working Papers 4913, National Bureau of Economic Research, Inc.
    4. Kossoudji, S.A. & Cobb-Clark, D., 1995. "Finding Good Opportunities within Undcoumented Markets: US Occupational Mobility for Latino Workers," CEPR Discussion Papers 331, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    5. Sherrie A. Kossoudji & Deborah A. Cobb-Clark, 2002. "Coming out of the Shadows: Learning about Legal Status and Wages from the Legalized Population," Journal of Labor Economics, University of Chicago Press, vol. 20(3), pages 598-628, July.
    6. Gordon H. Hanson, 2006. "Illegal Migration from Mexico to the United States," NBER Working Papers 12141, National Bureau of Economic Research, Inc.
    7. Sherrie A. Kossoudji & Deborah A. Cobb-Clark, 2000. "IRCA's impact on the occupational concentration and mobility of newly-legalized Mexican men," Journal of Population Economics, Springer, vol. 13(1), pages 81-98.
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    Cited by:
    1. Ying Pan, 2012. "The Impact of Legal Status on Immigrants’ Earnings and Human Capital: Evidence from the IRCA 1986," Journal of Labor Research, Springer, vol. 33(2), pages 119-142, June.
    2. Joël MACHADO, 2012. "On the welfare impacts of an immigration amnesty," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2012010, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).

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