Does restricting immigration improve economic performance?
There are a lot of studies looking at the economic impacts of immigration, but what about the economic impacts of restricting immigration? Over the past few years, a lot of cities and counties have enacted restrictive laws, which creates a nice natural experiment of sorts: As an area becomes less friendly to immigrants, what happens to its economy?
Huyen Pham and Pham Hoang Van looked into this in a paper called "The Economic Impact of Local Immigration Regulation: an Empirical Analysis," and their answer, basically, is nothing good:
The results of this empirical study, the first of its kind, show that the restrictive laws had a negative but small economic effect on the jurisdictions where they are enacted. Specifically, the authors find that these laws had a 1 to 2 percent negative effect on employment; for the average U.S. county, this translates to about 337 to 675 lost jobs (40 to 80 lost jobs for the median county). Consistent with the effect on employment, payroll was also negatively affected. This drop in employment includes both authorized and unauthorized workers. The authors also find that the laws reduced employment in some industries, such as the restaurant industry, while increasing employment in others, such as the grocery and liquor store industry. This suggests that affected workers may be switching jobs, rather than leaving a particular jurisdiction altogether.
August 5, 2010; 5:51 PM ET
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