What are the effects of immigration on the economy?

Introduction

The economic effects of immigration have been a subject of extensive research and debate. This synthesis aims to present a cohesive understanding of how immigration impacts the economy, focusing on labor markets, wages, public assistance, and overall economic growth.

Key Insights

Minimal Aggregate Impact on Native Workers' Earnings and Employment:
- The overall impact of immigration on the earnings and employment of native workers is generally small, though it can vary for specific subgroups and high ethnic density labor markets .
Skill Composition and Wage Effects:
- The skill composition of immigrants plays a crucial role in determining their impact on native labor market outcomes. Immigrants with similar skills to native workers may reduce wages for those natives, while those with complementary skills can increase wages for native workers .
Dynamic Economic Models and Modest Factor Price Shifts:
- In dynamic economic models with endogenous capital accumulation, the shifts in factor prices due to immigration are modest, resulting in smaller benefits and adverse effects on wages than previously thought.
Public Assistance and Fiscal Impact:
- The evidence on immigrants' receipt of public assistance is inconclusive, and the overall fiscal impact of immigration on government budgets can vary. Some studies suggest that the fiscal effects are minor or transient .
Human Capital and Economic Growth:
- The negative output and growth effects of immigration are less significant when the human capital of immigrants is considered. Higher human capital among immigrants can mitigate the adverse effects on per capita output and growth.
Distributional Consequences:
- Immigration can create winners and losers among native workers by altering the wage structure. Native workers with skills similar to those of immigrants may face wage reductions, while those with complementary skills may see wage increases .
Institutional Quality:
- Immigration does not negatively impact the quality of institutions and may have some positive effects on institutional quality, such as private property rights and economic freedom.

Conclusion

The economic effects of immigration are multifaceted and context-dependent. While the aggregate impact on native workers' earnings and employment is generally small, the skill composition of immigrants plays a significant role in determining specific outcomes. Dynamic economic models suggest modest shifts in factor prices, and the fiscal impact of immigration is often minor or transient. Importantly, the human capital of immigrants can mitigate negative growth effects, and immigration does not appear to harm institutional quality. Overall, immigration's economic consequences are nuanced, with both potential benefits and challenges.

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What are the effects of immigration on the economy?

Summary

Introduction

Key Insights

Conclusion

Sources and full results

The Economic Consequences of Immigration

Immigration has small impacts on native workers' earnings and employment, with immigrants from the 1970s having lower skills and earnings, and the evidence on their receipt of public assistance income is inconclusive.

How much do immigration and trade affect labor market outcomes?

Immigration and trade significantly impact the U.S. labor market, with immigrant flows to regional labor markets contributing to changes in educational wage differentials and affecting native workers' incomes.

The Impact of Immigration on the Labor Market

Immigration has a null or slightly positive impact on native wages and employment, but unexpected migration episodes can be detrimental, and skill composition of immigrants affects native labor market outcomes.

The economic effects of immigration--a dynamic analysis

Immigration has smaller benefits for natives and smaller adverse effects on wages than previously thought, with modest shifts in factor prices and a smaller role in redistribution from labor to capital.

The new Americans: economic demographic and fiscal effects of immigration.

Immigration to the United States positively impacts the economy, labor markets, and government budgets, with potential long-term effects on population size and composition.

The effects of immigration in a distorted two-sector economy.

Immigration increases unemployment and shifts income distribution against labor, but its impact on non-immigrants' total income is ambiguous due to the relative importance of unemployment and rent increases.

Immigration, human capital and growth in the host country

Higher human capital in immigrants reduces the negative output and growth effects on the host economy, making migration inflows less negative than comparable natural population increases.

The Economic Effects of Immigration into the United Kingdom

Large-scale immigration in the UK has mostly minor economic consequences, with vulnerable sections of the domestic population potentially damaged, and its demographic and environmental impact is likely to outweigh any benefits.

The Economics of Immigration

Immigration has had mixed economic effects on the US from the 1970s to the 1990s, with earlier research concluding it positively impacted the economy but recent research suggesting it may negatively impact native earnings and increase welfare burdens.

Does immigration impact institutions?

Immigration does not negatively impact a nation's institutional quality, but may have some positive impacts on private property rights, the rule of law, and economic freedom.

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