October 2015

Note: Before the launch of the Open Philanthropy Project Blog, this post appeared on the GiveWell Blog. Uses of “we” and “our” in the below post may refer to the Open Philanthropy Project or to GiveWell as an organization. Additional comments may be available at the original post.

As a consultant for the Open Philanthropy Project last year, I reviewed the research on whether immigration reduces employment or earnings for workers in receiving countries. I concluded that for natives the harm, if any, is small.

Last month the prominent immigration researcher George Borjas posted a challenge to a seminal study in my review. His new paper contends that the Mariel boatlift, which brought some 60,000 Cuban refugees to Miami in 1980, did profoundly affect the labor market there, depressing wages for low-education men (ones with less than a high school education) by 10–30%.

Borjas’s work is especially significant because it seems to upend a study of the boatlift published by David Card 25 years ago, which found little impact of all that immigration on workers in Miami. Interestingly, Borjas, who emphasizes the harm of Cuban immigration, is himself a Cuban emigré.

I probed this dispute, replicating and checking the results in the dueling papers. I ultimately found little cause to change my views. The main reasons:

• Of the two Census Bureau data sets that Borjas relies on, the one with larger samples shows smaller impacts.
• According to that data set, wages for women, which Borjas excludes, rose, if anything, after immigration spikes (especially after a second one in 1994–95).
• I see no sharp breaks from long-term trends of the sort that could be confidently attributed to the 1980 immigration surge. The Borjas analysis appears correct that wages for low-education Miami men (defined henceforth as those with less than a high school education) were lower on average in 1981–83 than in 1977–79—with the drop being larger than in most other US cities. But the data argue more for a steady long-term decline than sudden drops after immigration surges. The Borjas analysis tends to obscure this distinction by aggregating or smoothing data over several years.
• The original study by David Card is one of 17 covered in my review, including three others exploiting natural experiments in mass migration. None of the studies is as compelling as a randomized trial, but the overall picture—of at most modest harm from substantial immigration—does not change if the Card study is removed.

Details follow. [node:read-more:link]