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Legalization and the Economic Status of Immigrants

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  • Silvia Helena Barcellos

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.

Suggested Citation

  • Silvia Helena Barcellos, 2010. "Legalization and the Economic Status of Immigrants," Working Papers WR-754, RAND Corporation.
  • Handle: RePEc:ran:wpaper:wr-754
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    Cited by:

    1. Stefano Comino & Giovanni Mastrobuoni & Antonio Nicolò, 2020. "Silence of the Innocents: Undocumented Immigrants’ Underreporting of Crime and their Victimization," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 39(4), pages 1214-1245, September.
    2. Miao Chi, 2017. "Improved legal status as the major source of earnings premiums associated with intermarriage: evidence from the 1986 IRCA amnesty," Review of Economics of the Household, Springer, vol. 15(2), pages 691-706, June.
    3. Francesco Fasani, 2015. "Understanding the Role of Immigrants’ Legal Status: Evidence from Policy Experiments," CESifo Economic Studies, CESifo, vol. 61(3-4), pages 722-763.
    4. Magris, Francesco & Russo, Giuseppe, 2016. "Fiscal Revenues and Commitment in Immigration Amnesties," European Journal of Political Economy, Elsevier, vol. 42(C), pages 75-90.
    5. Fabio Méndez & Facundo Sepúlveda & Nieves Valdés, 2016. "Legalization and human capital accumulation," Journal of Population Economics, Springer;European Society for Population Economics, vol. 29(3), pages 721-756, July.
    6. Andri Chassambouli & Giovanni Peri, 2015. "The Labor Market Effects of Reducing the Number of Illegal Immigrants," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 18(4), pages 792-821, October.
    7. Eric Schuss, 2020. "Substantial Labor Market Effects of the Residency Status," Journal of International Migration and Integration, Springer, vol. 21(4), pages 993-1026, December.
    8. Casarico, Alessandra & Facchini, Giovanni & Frattini, Tommaso, 2018. "What drives the legalization of immigrants? Evidence from IRCA," Regional Science and Urban Economics, Elsevier, vol. 70(C), pages 258-273.
    9. Andri Chassambouli & Giovanni Peri, 2015. "The Labor Market Effects of Reducing the Number of Illegal Immigrants," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 18(4), pages 792-821, October.
    10. Andri Chassamboulli & Xiangbo Liu, 2020. "Immigration, Legal Status and Fiscal Impact," University of Cyprus Working Papers in Economics 07-2020, University of Cyprus Department of Economics.
    11. Wen Ci & Feng Hou & René Morissette, 2018. "Acquisition of permanent residence by temporary foreign workers in Canada: a panel study of labour market outcomes before and after the status transition," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 8(1), pages 1-24, December.
    12. 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.
    13. 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.
    14. Kuhn, Peter J. & Shen, Kailing, 2014. "Do Employers Prefer Undocumented Workers? Evidence from China's Hukou System," IZA Discussion Papers 8289, Institute of Labor Economics (IZA).
    15. Joël MACHADO, 2012. "On the welfare impacts of an immigration amnesty," LIDAM Discussion Papers IRES 2012010, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    16. Machado, Joël, 2017. "Dealing With Undocumented Immigrants: The Welfare Effects Of Amnesties And Deportations," Journal of Demographic Economics, Cambridge University Press, vol. 83(4), pages 445-492, December.
    17. Marcus H. Böhme & Sarah Kups, 2017. "The economic effects of labour immigration in developing countries: A literature review," OECD Development Centre Working Papers 335, OECD Publishing.
    18. Altangerel, Khulan, 2019. "Essays on immigration policy," Other publications TiSEM 954c6300-249e-496c-8cef-0, Tilburg University, School of Economics and Management.
    19. Chi, Miao & Drewianka, Scott, 2014. "How much is a green card worth? Evidence from Mexican men who marry women born in the U.S," Labour Economics, Elsevier, vol. 31(C), pages 103-116.
    20. Comino, Stefano & Mastrobuoni, Giovanni & Nicolò, Antonio, 2016. "Silence of the Innocents: Illegal Immigrants' Underreporting of Crime and their Victimization," Economics Discussion Papers 17806, University of Essex, Department of Economics.
    21. Eric Schuss, 2017. "Substantial Labor Market Effects of the Residency Status: How Important Are Initial Conditions at Arrival for Immigrants?," SOEPpapers on Multidisciplinary Panel Data Research 952, DIW Berlin, The German Socio-Economic Panel (SOEP).
    22. Lofstrom, Magnus & Hill, Laura E. & Hayes, Joseph, 2010. "Did Employer Sanctions Lose Their Bite? Labor Market Effects of Immigrant Legalization," IZA Discussion Papers 4972, Institute of Labor Economics (IZA).

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