Harvard Kennedy School Prof. George J. Borjas Fall 2013 SUP-311 The Economic Impact of Immigration Class: Mondays and Wednesdays, 10:10-11:30, BL-1 Office: Littauer 304 Telephone: 617-495-1393 Office Hours: Monday, Wednesday, 8:30-9:30, and by appointment (I m usually in my office most mornings, Monday-Thursday) Email: gborjas@harvard.edu Faculty Assistant: Stacy Hannell Littauer 307A Telephone: 617-496-1477 E-mail: Stacy_Hannell@hks.harvard.edu Overview This course examines the theoretical and empirical models developed to study the economic impact of immigration. The course examines the various economic issues that have dominated the debate over immigration policy in the United States and other receiving countries. These issues include the changing contribution of immigrants to the country s skill endowment; the rate of economic assimilation experienced by immigrants; the impact of immigrants on the employment opportunities of native-born workers; the extent to which immigrants pay their way in the welfare state; and the source and magnitude of the economic benefits generated by immigration. The course also examines the extent to which the economic impact of immigration persists across generations, and compares the consequences of the different immigration policies pursued by some of the largest immigrant-receiving countries. In sum: what does economics have to say about the consequences of immigration, and what does one have to assume to get it to say what it says? Prerequisites: Previous exposure to microeconomic theory at the level of API-101 is required. Requirements: There will be a midterm and a student presentation. The midterm will be composed of questions designed to test the student s familiarity with the various models and academic papers that are discussed in class and/or are in the syllabus. The midterm will count for 40 percent of the final grade. The midterm will be held on Monday, October 21, 2013. Please check your calendars as soon as possible and avoid any scheduling conflicts for the midterm. I will NOT
2 schedule makeup exams except for students with documented dire emergencies (e.g., you are admitted to a hospital). In addition, each student must make an in-class presentation. The nature of the presentation will depend on the number of students enrolled in the class. Typically, students form small groups, choose a topic that deals with some aspect of immigration policy anywhere in the world, and make a detailed 20-25 minute presentation. The presentations will take place in the last 2 or 3 weeks of the course, depending on enrollment. I can provide a suggested list of topics for the in-class presentation, but students are free to explore other areas of interest. I tend to be very open to topic choices as long as the topic was not carefully discussed in class (if in doubt, check with me). You should let me know of the topic by Monday, October 28, 2013; a page with the presentation title, a short paragraph describing the nature of the problem, and a list of the group members will do. The class presentation counts for 40 percent of the final grade. Finally, class participation is strongly encouraged, will be graded, and will count for 20 percent of the final grade. Class Logistics: 1. Students are expected to attend class, do the readings before the lecture, and be prepared to participate in class discussions. No mobile phones, tablets, PDAs, or laptops may be used in class. In short: No electronics of any type are allowed unless there s a documented need. See me or have the relevant administrator contact me if such a need exists. 2. Tardiness is extremely disruptive to the flow of the class. Please try to make it to the class on time. If I detect a problem as the semester progresses (or if any student complains about this issue), I will rethink the situation and most likely tax (i.e., a reduction in grade points) those who impose the negative externality. Readings: The course will track the discussion in George J. Borjas, Heaven s Door: Immigration Policy and the American Economy, Princeton University Press, 1999. The additional readings are designed to: (a) introduce the student to some of the key studies in the academic literature; and (b) expose the student to the (very) diverse set of models, findings, and inferences that inform the policy debate. (With one exception, I have purposefully avoided assigning any non-academic readings. The immigration debate is contentious enough as is, and there s little need to make it more so by relying on material whose main purpose is to influence the direction of the public discourse).
3 TOPICS AND READING LIST 1. Overview: Immigration in the United States George J. Borjas, Heaven s Door, Chapter 1. 2. The Selection of Immigrants George J. Borjas, Heaven s Door, Chapter 3. Daniel Chiquiar, and Gordon H. Hanson. International Migration, Self-Selection, and the Distribution of Wages: Evidence from Mexico and the United States, Journal of Political Economy (April 2005): 239-281. Fernández-Huertas Moraga, Jesús. New Evidence on Emigrant Selection, Review of Economics and Statistics, February 2011, pp. 72-96. Technical paper that contains the original presentation of the selection model: Borjas, George J. Self-selection and the earnings of immigrants, American Economic Review, September 1987, pp. 531-553. 3. Assimilation and Cohort Effects George J. Borjas, Heaven s Door, Chapter 2. Barry R. Chiswick, The Effect of Americanization on the Earnings of Foreign-Born Men, Journal of Political Economy (October 1978): 897-921. George J. Borjas, Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants, Journal of Labor Economics, October 1985. George J. Borjas, Immigration Economics, Chapter 2, Harvard University Press, forthcoming 2014. 3. The Labor Market Impact of Immigration: Theory George J. Borjas, Heaven s Door, Chapters 4 and 5. 4. The Labor Market Impact of Immigration: Descriptive Evidence David Card, The Impact of the Mariel Boatlift on the Miami Labor Market, Industrial and Labor Relations Review (January 1990): 245-257. George J. Borjas, The Labor Demand Curve Is Downward Sloping: Reexamining the Impact of Immigration on the Labor Market, Quarterly Journal of Economics (November 2003): 1335-1374. (First half of paper, through p. 1359) 6. The Labor Market Impact of Immigration: Structural Evidence George J. Borjas, The Labor Demand Curve Is Downward Sloping: Reexamining the Impact of Immigration on the Labor Market, Quarterly Journal of Economics (November 2003): 1335-1374. (Second half of paper, beginning on p. 1359)
4 21. David Card, Immigration and Inequality, American Economic Review (March 2009): 1- Very technical papers, but at the core of the current debate: Ottaviano, Gianmarco I. P., and Giovanni Peri. 2012. Rethinking the effect of immigration on wages, Journal of the European Economic Association 10: 152-197. Borjas, George J., Jeffrey Grogger, and Gordon H. Hanson. 2012. On estimating elasticities of substitution, Journal of the European Economic Association 10: 198-210. 7. The Economic Benefits from Immigration George J. Borjas, The Economic Benefits from Immigration, Journal of Economic Perspectives (Spring 1995): 3-22. Immigration s Economic Impact, Council of Economic Advisers, June 2007. George J. Borjas, Immigration Economics, Chapter 7, Harvard University Press, forthcoming 2014. (Section on Global Gains from Open Borders, starting on p. 7-17). 8. High-Skill Immigration Kerr, William R., and William F. Lincoln. The supply side of innovation: H-1b visa reforms and U.S. ethnic invention, Journal of Labor Economics, July 2010, pp. 473-508 Waldinger, Fabian. Quality matters: The expulsion of professors and the consequences for Ph.D. student outcomes in Nazi Germany, Journal of Political Economy, August 2010, pp. 787-831. Borjas, George J., and Kirk B. Doran. The collapse of the Soviet Union and the productivity of American mathematicians, Quarterly Journal of Economics, August 2012, pp. 1143-1203. 9. Social Mobility in Immigrant Families George J. Borjas. Making It in America: Social Mobility in the Immigrant Population, The Future of Children (Fall 2006): 55-71. Richard Alba, Amy Lutz, and Elena Vesselinov. How Enduring Were the Inequalities among European Immigrant Groups in the U.S.? Demography, August 2001, pp. 349-356. George J. Borjas, Long-Run Convergence of Ethnic Skill Differentials, Revisited, Demography (August 2001): 357-361. 10. Determinants of Social Mobility George J. Borjas, Heaven s Door, Chapter 9. George J. Borjas, Ethnic Capital and Intergenerational Mobility, Quarterly Journal of Economics (February 1992): 123-150. Duncan, Brian, and Stephen J. Trejo. 2011. Intermarriage and the intergenerational transmission of ethnic identity and human capital for Mexican Americans, Journal of Labor Economics 29: 195-227. 11. The Fiscal Impact of Immigration
5 James P. Smith and Barry Edmonston, Chapter 6: Do immigrants impose a net fiscal burden? Annual estimates, and Chapter 7: The Future fiscal impacts of current immigration, The New Americans: Economic, Demographic, and Fiscal Effects of Immigration, Washington, D.C.: National Academy Press, 1997, pp. 254-296, 297-362. George J. Borjas. Welfare Reform and Immigration, in The New World of Welfare: An Agenda for Reauthorization and Beyond, edited by Rebecca Blank and Ron Haskins, Brookings Press, 2001. 12. Thinking about Immigration Policy George J. Borjas, Heaven s Door, Chapters 10 and 11. Aydemir, Abdurrahman, and Mikal Skuterud. 2005. Explaining the deteriorating entry earnings of Canada s immigrant cohorts, 1966-2000, Canadian Journal of Economics 38: 641-672.