The Economic Effects of Immigration Restriction Policies - Evidence from the Italian Mass Migration to the US

Davide M. Coluccia and Lorenzo Spadavecchia ()

No 9361, CESifo Working Paper Series from CESifo

Abstract: This article studies the impact of immigration restriction policies on technology adoption in sending countries. From 1920 to 1921, the number of Italian immigrants to the United States dropped by 85% after Congress passed the Emergency Quota Act, a severely restrictive immigration law. In a difference-in-differences setting, we exploit variation in exposure across Italian districts to this massive restriction against human mobility. Using novel individual-level data on Italian immigrants to the US and newly digitized historical censuses, we show that this policy substantially hampered technology adoption and capital investment. We interpret this as evidence of directed technical adoption: an increase in the labor supply dampens the incentive for firms to adopt labor-saving technologies. To validate this mechanism, we show that more exposed districts display a sizable increase in overall population and employment in manufacturing. We provide evidence that “missing migrants,” whose migration was inhibited by the Act, drive this result.

Keywords: age of mass migration; emigration; economic development; immigration barriers; technology adoption (search for similar items in EconPapers)
JEL-codes: N14 N34 O15 O33 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-gro, nep-his, nep-int, nep-lab, nep-mig and nep-ure
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Citations: View citations in EconPapers (1)

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