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Implications of U.S. Immigration Policies for North American Economies

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  • Devadoss, Stephen
  • Zhao, Xin
  • Luckstead, Jeff

Abstract

We develop a four-sector (labor-intensive agriculture, capital-intensive agriculture, service & construction, and manufacturing) general-equilibrium model of North American countries to analyze the effects of tighter U.S. immigration policies. Results show that these policies erode the comparative advantage of U.S. labor-intensive agriculture, causing U.S. production and exports to fall and other countries to expand their exports to the United States. In Mexico, low-skilled labor demand in labor-intensive agriculture increases as production rises. The effectiveness of U.S. tighter immigration policies depends on the substitutability between U.S. domestic and undocumented workers. Immigration policies exacerbate the wedge between Mexican low-skilled wage rate and the undocumented wage rate, intensifying the underlying cause for unauthorized entry.

Suggested Citation

  • Devadoss, Stephen & Zhao, Xin & Luckstead, Jeff, 2020. "Implications of U.S. Immigration Policies for North American Economies," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 45(1), January.
    • Handle: RePEc:ags:jlaare:298440
    DOI: 10.22004/ag.econ.298440
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    Cited by:

    1. Diane Charlton & Genti Kostandini, 2021. "Can Technology Compensate for a Labor Shortage? Effects of 287(g) Immigration Policies on the U.S. Dairy Industry," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(1), pages 70-89, January.
    2. An Li & Jeffrey J. Reimer, 2021. "The US Market for Agricultural Labor: Evidence from the National Agricultural Workers Survey," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(3), pages 1125-1139, September.

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    Keywords

    International Relations/Trade;

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