Working Paper: NBER ID: w2566
Authors: George J. Borjas
Abstract: Self-selection plays a dominant role in determining the size and composition of immigrant flows. The United States competes with other potential host countries in the "immigration market". Host countries vary in their "offers" of economic opportunities and also differ in the way they ration entry through their immigration policies. Potential immigrants compare the various opportunities and are non-randomly sorted by the immigration market among the various host countries. This paper presents a theoretical and empirical analysis of this marketplace. The theory of immigration presented in this paper describes the way in which immigrants are sorted among host countries in terms of both their observed and unobserved characteristics. The empirical analysis uses Census data from Australia, Canada, and the United States and shows that U.S. "competitiveness" in the immigration market has declined significantly in the postwar period.
Keywords: Immigration; Self-Selection; Economic Opportunities
JEL Codes: J61; F22
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Economic conditions in the home country (F29) | likelihood of migration to the United States (F22) |
| Economic conditions in the home country (F29) | characteristics of migrants (J61) |
| Education levels (I21) | likelihood of migration (F22) |
| Income disparities (D31) | likelihood of migration (F22) |
| Migration costs (F22) | likelihood of migration (F22) |
| Economic conditions in the home country (F29) | negative selection among migrants (F22) |
| Economic conditions in the home country (F29) | positive selection in education among immigrants (J68) |