Temporary Protected Status and Immigration to the United States

Abstract

Although immigration reform has proved elusive for more than forty years, presidents from both parties have issued crucial executive actions that regulate inflows of new immigrants and the status of those already in the US. We focus on a particular class of executive actions, those related to granting immigrants Temporary Protected Status (TPS), exploiting the fact that immigrants who hold TPS receive access to the formal US labor market regardless of their legal status. Harnessing the New Economics of Labor Migration (NELM), we hypothesize that granting TPS to immigrants increases remittances to crisis-affected countries, decreasing the demand for both legal and illegal entry into the United States. We find robust statistical support for this hypothesis, and we also use synthetic control methods to evaluate TPS as a policy lever in prominent TPS-eligible countries. Our findings shed light on potentially unintended consequences that flow from providing labor market access to immigrants in the United States.

Keywords: Immigration, Remittances, Apprehensions, New Economics of Labor Migration

JEL Classification: F22, F24