The Economic Impact of Local Immigration Regulation: An Empirical Analysis
34 Pages Posted: 4 Aug 2010 Last revised: 10 Aug 2010
Date Written: August 4, 2010
A wave of local anti-immigration laws has swept the country, triggering contentious debate and raising significant legal and policy issues. Approximately 150 such laws were enacted between 2005 and 2008 though many of these laws are being challenged in the courts. One critical dimension that has been largely ignored, however, is the economic impact of these laws: are jurisdictions with them better off economically than those without them?
In the first empirical study of this issue, we analyze the economic impact of these laws. The laws take different forms - some authorize local police to enforce federal immigration laws, some restrict benefits like housing and employment to those with legal immigration status, and some require all government transactions to be conducted in English only.
We applied statistical techniques to analyze two sets of data: a legal data set that we compiled of restrictive immigration laws enacted by cities and counties and the County Business Patterns economic data set compiled by the U.S. Census Bureau. The results show that the restrictive laws had a negative but small economic effect on the jurisdictions where they are enacted. Specifically, we 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 jobs (40 to 80 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. We 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.
Because local immigration regulation has such profound policy impact, local governments considering the efficacy of these laws need to base their decisions on empirical evidence, not assumptions, about the laws’ effect. This Article provides crucial information for that decision making.
Keywords: Immigration, Law Enforcement, Empirical, Local Immigration Regulation, Economic Impact, Local Immigration, Illegal Immigration, Public Policy, Immigration Policy, Immigration Federalism
JEL Classification: J15, J18, J61, J68, K31
Suggested Citation: Suggested Citation