Article, 2023

The Effect of Immigration Restrictions on Local Labor Markets: Lessons from the 1920s Border Closure

In: American Economic Journal Applied Economics, ISSN 1945-7790, 1945-7782, Volume 15, 1, Pages 164-191, 10.1257/app.20200807

Contributors (5)

Abramitzky, Ran (0000-0002-5697-132X) [1] Ager, Philipp (0000-0001-9830-9185) [2] Boustan, Leah Platt [3] Cohen, Elior [4] Hansen, Casper Worm [5]

Affiliations

  1. [1] Stanford University
  2. [NORA names: United States; America, North; OECD]
  3. [2] University of Mannheim
  4. [NORA names: Germany; Europe, EU; OECD]
  5. [3] Princeton University
  6. [NORA names: United States; America, North; OECD]
  7. [4] Federal Reserve Bank of Kansas City (email: )
  8. [5] University of Copenhagen
  9. [NORA names: KU University of Copenhagen; University; Denmark; Europe, EU; Nordic; OECD]

Abstract

In the 1920s, the United States substantially reduced immigration by imposing country-specific entry quotas. We compare local labor markets differentially exposed to the quotas due to variation in the national-origin mix of their immigrant population. US-born workers in areas losing immigrants did not benefit relative to workers in less exposed areas. Instead, in urban areas, European immigrants were replaced with internal migrants and immigrants from Mexico and Canada. By contrast, farmers shifted toward capital-intensive agriculture, and the immigrant-intensive mining industry contracted. These differences highlight the uneven effects of the quota system at the local level. (JEL J15, J18, J31, K37, N32, N42, R23)

Keywords

Canada, European immigrants, Mexico, United States, agriculture, area, border closures, capital-intensive agriculture, closure, contrast, differences, effect, farmers, immigrant population, immigrants, immigration, immigration restrictions, industry, internal migrants, labor market, lessons, levels, local labor markets, local level, market, migrants, mining industry, mix, population, quota system, quotas, restriction, state, system, uneven effects, urban areas, uses, variation, workers