Judd Leighton School of Business and Economics
P.O. Box 7111
South Bend, IN 46634-7111
Institutional Affiliation: Indiana University South Bend
NBER Working Papers and Publications
|April 2015||Are Immigrants a Shot in the Arm for the Local Economy?|
with John McLaren: w21123
Most research on the effects of immigration focuses on the effects of immigrants as adding to the supply of labor. By contrast, this paper studies the effects of immigrants on local labor demand, due to the increase in consumer demand for local services created by immigrants. This effect can attenuate downward pressure from immigrants on non-immigrants' wages, and also benefit non-immigrants by increasing the variety of local services available. For this reason, immigrants can raise native workers' real wages, and each immigrant could create more than one job. Using US Census data from 1980 to 2000, we find considerable evidence for these effects: Each immigrant creates 1.2 local jobs for local workers, most of them going to native workers, and 62% of these jobs are in non-traded servi...