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Legalization and the Economic Status of Immigrants

  • Silvia Helena Barcellos

    ()

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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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. David S. Lee & Thomas Lemieux, 2009. "Regression Discontinuity Designs in Economics," NBER Working Papers 14723, National Bureau of Economic Research, Inc.
  2. David Lindstrom, 1996. "Economic opportunity in mexico and return migration from the United States," Demography, Springer, vol. 33(3), pages 357-374, August.
  3. Kossoudji, S.A. & Cobb-Clark, D.A., 1996. "Coming Out of the Shadows: Learning About Legal Status and Wages from the Legalized Population," CEPR Discussion Papers 347, Centre for Economic Policy Research, Research School of Economics, Australian National University.
  4. Gordon H. Hanson, 2006. "Illegal Migration from Mexico to the United States," Journal of Economic Literature, American Economic Association, vol. 44(4), pages 869-924, December.
  5. Kristin F. Butcher, 1994. "Black immigrants in the United States: A comparison with native blacks and other immigrants," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 47(2), pages 265-284, January.
  6. Borjas, George J & Bratsberg, Bernt, 1996. "Who Leaves? The Outmigration of the Foreign-Born," The Review of Economics and Statistics, MIT Press, vol. 78(1), pages 165-76, February.
  7. 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.
  8. 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.
  9. 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.
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