The Grecian Horse II: Do Immigrants Import Their Home Country’s Institutions Into Their Host Countries? The Case of the American States

75 Pages Posted: 7 Feb 2019 Last revised: 7 Jun 2019

See all articles by Alexandre Padilla

Alexandre Padilla

Metropolitan State University of Denver - Department of Economics

Nicolas Cachanosky

Metropolitan State University of Denver; American Institute for Economic Research

Date Written: January 15, 2019

Abstract

In recent years, in response to an increasing literature pointing to the economic deadweight loss associated with immigration restrictions, a literature has emerged pointing to the negative economic repercussions on economic growth would increasing immigration from countries with poor institutions have on the quality of the host country's institutions when these immigrants import their institutions into their host countries. Since then economists have attempted to test whether immigrants have a negative impact on their host country’s institutions. This paper builds on Padilla and Cachanosky (2018) and examines how immigrants grouped according the Economic Freedom of the World quartile their country of origin was ranked at time of the census may impact the economic institutions of the states as measured by Economic Freedom of North America index. Our results show that, in the short run, we do observe that the relationship between migrants originating from countries with poor economic institutions and economic freedom is negative, but, in the longer run, that relationship becomes positive, particularly, in the area of labor market freedom. On the other hand, in the longer run, the relationship between migrants coming from most economically free countries and economic freedom is negative. Our results are robust to various specifications.

Keywords: Economic freedom, Immigration, Institutions, State government

JEL Classification: F22, H70, O43

Suggested Citation

Padilla, Alexandre and Cachanosky, Nicolas, The Grecian Horse II: Do Immigrants Import Their Home Country’s Institutions Into Their Host Countries? The Case of the American States (January 15, 2019). Available at SSRN: https://ssrn.com/abstract=3316415 or http://dx.doi.org/10.2139/ssrn.3316415

Alexandre Padilla (Contact Author)

Metropolitan State University of Denver - Department of Economics ( email )

Economics department, Campus Box 77
PO Box 173362
Denver, CO 80217
United States
303- 615-0111 (Phone)
303-556-3966 (Fax)

HOME PAGE: http://www.alexandrepadilla.com

Nicolas Cachanosky

Metropolitan State University of Denver ( email )

Student Success Building
890 Auraria Pkwy #310
Denver, CO 80217
United States

HOME PAGE: http://www.ncachanosky.edu

American Institute for Economic Research

PO Box 1000
Great Barrington, MA 01230
United States

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