Understanding the Effects of Legalizing Undocumented Immigrants

Arbeitspapier

This paper investigates the consequences of the legalization of around 600,000 immigrants by the unexpectedly elected Spanish government of Zapatero following the terrorist attacks of March 2004 (Garcia-Montalvo, 2011). Using detailed data from payroll-tax revenues, we estimate that each newly legalized immigrant increased local social-security revenues by 3,504 Euros on average. This estimate is only 49 percent of what we would have expected from the size of the newly documented immigrants, which suggests that newly legalized immigrants probably earned lower wages than, and maybe affected the labor-market outcomes of, other workers. We estimate that the policy change deteriorated the labor-market outcomes of some low-skilled natives and immigrants and improved the outcomes of highskilled natives and immigrants. This led some low-skilled immigrants to move away from high-immigrant locations. Correcting for internal migration and selection, we obtain that each newly legalized immigrant increased payroll-tax re nues by 4,368 Euros or 25 percent more than the raw payroll-tax revenue data estimates. This shows the importance of looking both at public revenue data and the labor market to understand the consequences of amnesty programs fully.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CReAM Discussion Paper Series ; No. 08/17

Classification and Topics

• Classification: Wirtschaft ; International Migration ; Wage Level and Structure; Wage Differentials ; Geographic Labor Mobility; Immigrant Workers ; Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
• Subject: Immigration ; undocumented immigrants ; public policy evaluation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Monras, Joan ; Vázquez-Grenno, Javier ; Elias, Ferran
• Event: Veröffentlichung
• (who): Centre for Research & Analysis of Migration (CReAM), Department of Economics, University College London
• (where): London
• (when): 2017

Further information

• Last update: 10.03.2025, 11:43 AM CET