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The Effects of Immigration on the Economy: Lessons from the 1920s Border Closure

Ran Abramitzky, Philipp Ager (), Leah Boustan (), Elior Cohen and Casper Hansen ()

No 26536, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: In the 1920s, the United States substantially reduced immigrant entry by imposing country-specific quotas. We compare local labor markets with more or less exposure to the national quotas due to differences in initial immigrant settlement. A puzzle emerges: the earnings of existing US-born workers declined after the border closure, despite the loss of immigrant labor supply. We find that more skilled US-born workers – along with unrestricted immigrants from Mexico and Canada – moved into affected urban areas, completely replacing European immigrants. By contrast, the loss of immigrant workers encouraged farmers to shift toward capital-intensive agriculture and discouraged entry from unrestricted workers.

JEL-codes: J6 J61 N21 (search for similar items in EconPapers)
Date: 2019-12
New Economics Papers: this item is included in nep-dem, nep-his, nep-int, nep-lab, nep-mig and nep-ure
Note: LS DAE
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