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The political economy of immigrant legalisation: evidence from the 1986 IRCA

Navid Sabet and Christoph Winter

No 7611, CESifo Working Paper Series from CESifo Group Munich

Abstract: What happens to the distribution of public resources when undocumented migrants obtain legal status through nation-wide amnesty? In this paper, we exploit variation in legal status from the 1986 Immigration Reform and Control Act (IRCA) to answer this question and find that state governors, of whatever party affiliation, allocate more per capita aid to those counties affected by the IRCA. We posit that this is borne out of rational, forward-looking governors who allocate resources strategically in pursuit of the votes of the newly legalised who were eligible to vote five years after legalisation. To support this view, we find that the distribution of state aid differs significantly according to political context. Counties affected by the IRCA receive more resources from the state when their governor is eligible for re-election, faces political competition or enjoys line-item veto power. Our results also indicate that the transfers were targeted to the newly legalised, who by and large were of Hispanic origin, and not other constituents. We find no evidence of anti-migrant sentiment confounding our results. Counties that received more transfers from the governor also experienced improvements in Hispanic high school completion rates.

Keywords: immigrant legalisation; distributive politics; state and local government (search for similar items in EconPapers)
JEL-codes: J15 H72 P16 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cdm, nep-mig and nep-pol
Date: 2019
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