Immigration, Economic Freedom, and Ideology

ABSTRACT

Concerns about immigrants’ impact on US institutions are not new. We find such concerns in the correspondences and writings of Benjamin Franklin, Thomas Jefferson, and Alexander Hamilton. More recently, Borjas argues immigrants from countries with poor institutions could substantially undermine US institutions negating all economic gains associated with immigration in terms of GDP and income. In this article, we review our research, attempting to measure immigrants’ impact on US states’ institutions. Our results don’t confirm Borjas’s hypothesis. Our results show that whatever impact immigrants may have on US institutions is neither statistically nor economically significant.

KEYWORDS:

• Economic freedom
• immigration
• institutions
• state government

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ To be more accurate, Borjas (2016, 100) does acknowledge that the assimilation rate of immigrants during the age of mass immigration is on the same level as the one of immigrants who have arrived since the late 1960s. In other words, the assimilation rate of immigrants was faster during the era of immigration quotas. See also Abramitzky, Boustan, and Eriksson (2014).

² Borjas (2016, 46) does cite Fishman and Miguel (2007) showing that United Nations officials, constrained only by cultural norms in virtue of their diplomatic immunity, particularly as it relates to parking enforcement actions, were more likely to commit parking infractions when they come from high-corruption countries. After 2002, when enforcement authorities acquired the right to confiscate the diplomatic license plates of violators, parking violations dropped significantly, suggesting that cultural norms are an important determinant of corruption and quality of institutions. On the other hand, see Bologna Pavlik, Lujan Padilla, and Powell (2019) which shows that recipient countries with a higher share of immigrants originating from countries with a higher corruption level don’t see an increase in corruption level, but quite the opposite.

³ Borjas (2016) does not explicitly advocate a return to the era of quotas, even though the evidence he discusses points to the idea that integration and assimilation was much faster during this period of US immigration history.

⁴ Israel’s population increased by 20% (Powell, Clark, and Nowrasteh 2017, 85).

⁵ As explained by Nowrasteh, Forrester, and Blondin (2019, 5), to understand what such an increase would mean for the United States, in 2015, a 10% increase in the pre-surge population would amount to having 31.6 million immigrants entering the United States in a single year.

⁶ While no US state has really experienced mass immigration in recent decades, in 1980, Miami saw its population increase by about 8% (over 100,000 Cubans) as a result of Fidel Castro allowing Cubans wishing to move to the United States to depart from the port of Mariel (Borjas 2016, 133). No study has attempted to see if there was an institutional impact as a result of the mass immigration to Miami, but several studies have attempted to measure how such a mass immigration impacted wages. While this is not related to our topic, it’s worth mentioning that those studies are not in agreement on the impact this mass immigration of Cubans to Miami had on wages. See Borjas (2016, 132–151) for a discussion of these studies.

⁷ However, as Padilla and Cachanosky (2018, 392–393, 402–403) note, that relationship becomes positive and statistically significant at the 1% level in their fixed effects in differences specification.

⁸ See also Mayda, Peri, and Steingress (2018, 28–29) who show that, as a result, natives, particularly those living in low-skilled non-urban areas, who perceive immigrants’ public policy preferences, particularly those from low-skilled immigrants, as diverging from theirs will tend to vote more for Republicans. This tendency is exacerbated if they believe natives are competing with low-skilled immigrants in labor markets.