Working Paper: NBER ID: w27997
Authors: Dany Bahar; Prithwiraj Choudhury; Britta Glennon
Abstract: On June 22, 2020, President Trump issued an Executive Order (EO) that suspended new work visas, barring nearly 200,000 foreign workers and their dependents from entering the United States and preventing American companies from hiring skilled immigrants using H-1B or L1 visas. Exploiting this shock, and using event study methodology analyzing the cumulative average abnormal returns (CAARs) of Fortune 500 companies following this order, we find that the EO statistically and economically significantly caused negative CAARs of up to 0.45%, the equivalent of over 100 billion of US dollars of losses, based on the firms’ valuation before the event. Our results are particularly pronounced for firms that had maintained or increased their reliance on skilled immigrant workers over the prior years.
Keywords: No keywords provided
JEL Codes: G14; G38; J61
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Executive Order (EO) (K16) | Cumulative Average Abnormal Returns (CAARs) (C22) |
| Executive Order (EO) (K16) | Market Valuation of Fortune 500 Firms (G32) |
| Executive Order (EO) (K16) | Negative CAARs (C22) |
| Executive Order (EO) (K16) | Stock Prices of Firms Reliant on Immigrant Labor (K37) |