The Grecian Horse: Does Immigration Lead to the Deterioration of American Institutions?

Abstract

Concerns about the institutional impact of immigration, particularly, in the United States, are not new. We can trace them all the way back to Thomas Jefferson and Alexander Hamilton. More recently, in response to a literature that questions the efficiency of current immigration restrictions, Borjas (2015) expresses similar concerns about the institutional impact of immigrants coming from countries with poor institutions. Using economic freedom as proxy for institutional quality of the American states since 1980, using several estimation techniques and control variables, our results show that concerns about the institutional impact of immigrants are so far not supported.

Keywords: Immigration, Institutions, Economic Freedom

JEL Classification: F22, H70, O43