<abstract xmlns="http://www.w3.org/1999/xhtml"><p>This study quantifies the economic effects of two major immigration policies aimed at legalizing undocumented individuals that entered the United States as children and completed high school: Deferred Action for Childhood Arrivals (DACA) and the DREAM Act. The former offers only temporary legal status to eligible individuals, whereas the latter provides a track to legal permanent residence. Our analysis is based on a general equilibrium model that allows for shifts in participation between work, college, and non-employment. The model is calibrated to account for productivity differences across workers of different skills and documentation status, and a rich pattern of complementarities across different types of workers. We estimate that DACA increased gross domestic product (GDP) by almost 0.02% (about $3.5 billion), or $7,454 per legalized worker. Passing the DREAM Act would increase GDP by around 0.08% (or $15.2 billion), which amounts to an average of $15,371 for each legalized worker. The larger effects of the DREAM Act stem from the expected larger take-up and the increased incentive to attend college among DREAMers with a high school degree. We also find substantial wage increases for individuals obtaining legal status, particularly those that increase their educational attainment. Because of the small size of the DREAMer population, and their skill distribution, legalization entails negligible effects on the wages of US-born workers.</p></abstract>

This study quantifies the economic effects of two major immigration policies aimed at legalizing undocumented individuals that entered the United States as children and completed high school: Deferred Action for Childhood Arrivals (DACA) and the DREAM Act. The former offers only temporary legal status to eligible individuals, whereas the latter provides a track to legal permanent residence. Our analysis is based on a general equilibrium model that allows for shifts in participation between work, college, and non-employment. The model is calibrated to account for productivity differences across workers of different skills and documentation status, and a rich pattern of complementarities across different types of workers. We estimate that DACA increased gross domestic product (GDP) by almost 0.02% (about $3.5 billion), or $7,454 per legalized worker. Passing the DREAM Act would increase GDP by around 0.08% (or $15.2 billion), which amounts to an average of $15,371 for each legalized worker. The larger effects of the DREAM Act stem from the expected larger take-up and the increased incentive to attend college among DREAMers with a high school degree. We also find substantial wage increases for individuals obtaining legal status, particularly those that increase their educational attainment. Because of the small size of the DREAMer population, and their skill distribution, legalization entails negligible effects on the wages of US-born workers.

The Economic Effects of Providing Legal Status to DREAMers

IZA Journal of Labor Policy

This work is licensed under the Creative Commons Attribution 4.0 Public License.

{"article-title":"The Economic Effects of Providing Legal Status to DREAMers"}

This study quantifies the economic effects of two major immigration policies aimed at legalizing undocumented individuals that entered the United States as...

The Economic Effects of Providing Legal Status to DREAMers

Published Online: Aug 27, 2019

Page range: -

DOI: https://doi.org/10.2478/izajolp-2019-0005

Keywords
DREAMers, immigration, legalization, undocumented

© 2019 Francesc Ortega, Ryan Edwards, Amy Hsin, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 Public License.

The Economic Effects of Providing Legal Status to DREAMers

Published Online: Aug 27, 2019

Page range: -

DOI: https://doi.org/10.2478/izajolp-2019-0005

KeywordsDREAMers, immigration, legalization, undocumented

© 2019 Francesc Ortega, Ryan Edwards, Amy Hsin, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 Public License.

Keywords
DREAMers, immigration, legalization, undocumented