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The Effect of Immigration on Local Labor Markets: Lessons from the 1920s Border Closure

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Abstract

In the 1920s, the United States substantially reduced immigration by imposing country-specific entry quotas. We compare local labor markets differentially exposed to the quotas due to variation in the national origin mix of their immigrant populations. U.S.-born workers in areas losing immigrants did not gain in income score relative to workers in less exposed areas. Instead, in urban areas, European immigrants were replaced with internal migrants and immigrants from Mexico and Canada. By contrast, farmers shifted toward capital-intensive agriculture, and the immigrant-intensive mining industry contracted. These differences highlight the uneven effects of the quota system at the local level.

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  • Ran Abramitzky & Philipp Ager & Leah Boustan & Elior Cohen & Casper Hansen, 2021. "The Effect of Immigration on Local Labor Markets: Lessons from the 1920s Border Closure," Research Working Paper RWP 21-09, Federal Reserve Bank of Kansas City.
  • Handle: RePEc:fip:fedkrw:93104
    DOI: 10.18651/RWP2021-09
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    More about this item

    Keywords

    Immigration; Immigrants; Labor;
    All these keywords.

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • N31 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - U.S.; Canada: Pre-1913
    • N32 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - U.S.; Canada: 1913-

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