Are the immigrants good or bad for the US economy?

Introduction

A growing literature investigates both the economic and non-economic determinants of individual preferences over distinct aspects of globalization and, in particular, over migration. The analysis of economic drivers is based on the income-distribution effects of international labour movements. The reasoning is that, assuming self-interest maximizing behaviour, individual attitudes in survey data sets contemplate the impact of migration on each respondent's individual utility. Thus the analysis of attitudinal responses, blended with information on each individual's socio-economic characteristics, allows an indirect test of the income-distribution predictions of migration models. In addition, the availability in survey data sets of questions on values and on cultural and security issues makes it possible to investigate how international migration is seen at the individual grade from a non-economic issue of view.

Through the labour market, the form predicts that the income-distribution effects of migration count on the skill composition of migrants relative to natives in the destination country. If immigrants are on average unskilled relative to natives, through the labour-market channel they will injure unskilled natives and advantage skilled ones, as their arrival will induce an increase in the skilled wage and a decrease in the unskilled wage. At the identical time, if immigrants are on mean more accomplished than natives, the income-distribution consequences of migration through the work market are reversed, i.e., unskilled employees end up benefiting from migration, while skilled employees are on the mislaying end. In other words, the span to which immigrants and natives are on average complements or substitutes in the labour market plays a key function in shaping natives' attitudes towards inflows of foreign workers. Thus, in our empirical analysis we anticipate to find that, through the labour market channel, if migration is unskilled (relative to natives on average), attitudes will be positively correlated with the grade of individual skill while, if migration is skilled, attitudes will be negatively correlated with the grade of individual skill.

To understand the effects of immigration through the welfare state channel, we consider a simple redistributive system, in which all earnings is taxed at the same rate, and all individuals in the finances, i.e., natives and immigrants, are deserving to obtain an equal chunk sum per capita advantage (i.e., a demogrant). By construction, this easy welfare scheme redistributes assets from high-income persons to low-income constituents of society. We hypothesize that immigration can affect the employed of this system in two farthest directions.On the one hand, migration can convey about changes in the tax rate, to hold the per capita benefits constant (tax adjustment model). On the other, the per capita benefits can adjust to hold the tax rate constant (benefit adjustment model).

If migration is unskilled, under both principle scenarios all natives will be negatively affected by the presence of foreign workers, through a welfare-state leakage effect. On the other hand, if immigration is skilled, all natives will advantage from a positive welfare spillover. However, the span to which natives suffer (benefit) from unskilled (skilled) migration through the ...