Immigration and Welfare Magnets

George J. Borjas

NBER Working Paper No. 6813
Issued in November 1998
NBER Program(s):   PE   LS

This paper investigates if the location choices made by immigrants when they arrive in the United States are influenced by the interstate dispersion in welfare benefits. Income-maximizing behavior implies that foreign-born welfare recipients unlike their native-born counterparts, may be clustered in the states that offer the highest benefits. The empirical analysis indicates that immigrant welfare recipients are indeed more heavily clustered in high-benefit states than the immigrants who do not receive welfare, or than natives. As a result, the welfare participation rate of immigrants is much more sensitive to changes in welfare benefits than that of natives.

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Published: Journal of Labor Economics, Vol. 17, no. 4, part 1 (October 1999): 607-637

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