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The Differential Wage Impact of the Immigration Reform and Control Act on Latino Ethnic Subgroups

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  • Cynthia Bansak

Abstract

Objective. This article tests whether employer sanctions for hiring undocumented workers, a provision of the 1986 Immigration Reform and Control Act (IRCA), adversely affected the hourly earnings of Latino workers. Methods. Using the Current Population Survey Outgoing Rotation Group Files from 1983–1990, a natural experiment framework is developed to assess the differential wage impact of employer sanctions on Latino ethnic subgroups. Results. Estimates of wage changes indicate that workers of Mexican descent saw a sizeable pre‐post IRCA decline in their hourly earnings relative to Cuban or Puerto Rican workers. Moreover, this change in wages is not observed among non‐Latino white workers. Controlling for the level of enforcement explains part of this decline immediately following the passage of IRCA, and enforcement efforts continue to be a significant factor several years later. Conclusions. The majority of evidence is consistent with the contention that employer sanctions adversely affected the earnings of Mexican workers.

Suggested Citation

  • Cynthia Bansak, 2005. "The Differential Wage Impact of the Immigration Reform and Control Act on Latino Ethnic Subgroups," Social Science Quarterly, Southwestern Social Science Association, vol. 86(s1), pages 1279-1298, December.
    • Handle: RePEc:bla:socsci:v:86:y:2005:i:s1:p:1279-1298
    DOI: 10.1111/j.0038-4941.2005.00346.x
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    Cited by:

    1. Stark, Oded & Jakubek, Marcin, 2024. "Employer Sanctions: A Policy with a Pitfall?," EconStor Open Access Book Chapters, in: World Scientific Handbook of Global Migration, Volume 1, pages 205-223, ZBW - Leibniz Information Centre for Economics.
    2. Mark Hoekstra & Sandra Orozco-Aleman, 2017. "Illegal Immigration, State Law, and Deterrence," American Economic Journal: Economic Policy, American Economic Association, vol. 9(2), pages 228-252, May.
    3. Pia M. Orrenius & Madeline Zavodny, 2009. "The effects of tougher enforcement on the job prospects of recent Latin American immigrants," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 28(2), pages 239-257.
    4. Amuedo-Dorantes, Catalina & Arenas-Arroyo, Esther, 2020. "U.S. Immigration Policy and Immigrant Fertility," IZA Discussion Papers 13748, Institute of Labor Economics (IZA).
    5. Amuedo-Dorantes, Catalina & Arenas-Arroy, Esther, 2017. "Immigrant Fertility in the Midst of Intensified Enforcement," GLO Discussion Paper Series 1, Global Labor Organization (GLO).
    6. Stark, Oded & Jakubek, Marcin, 2012. "Employer sanctions, and the welfare of native workers," Economics Letters, Elsevier, vol. 117(3), pages 533-536.
    7. Martin Ruhs, 2017. "The Impact of Acquiring EU Status on the Earnings of East European Migrants in the UK: Evidence from a Quasi-Natural Experiment," British Journal of Industrial Relations, London School of Economics, vol. 55(4), pages 716-750, December.
    8. Catalina Amuedo-Dorantes & Cynthia Bansak, 2011. "The Impact of Amnesty on Labor Market Outcomes: A Panel Study Using the Legalized Population Survey," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 50(3), pages 443-471, July.
    9. Tara Watson, 2013. "Enforcement and immigrant location choice," Working Papers 13-10, Federal Reserve Bank of Boston.
    10. Amuedo-Dorantes, Catalina & Arenas-Arroyo, Esther, 2021. "Immigration policy and fertility: Evidence from undocumented migrants in the U.S," Journal of Economic Behavior & Organization, Elsevier, vol. 189(C), pages 274-297.
    11. Tara Watson, 2014. "Inside the Refrigerator: Immigration Enforcement and Chilling Effects in Medicaid Participation," American Economic Journal: Economic Policy, American Economic Association, vol. 6(3), pages 313-338, August.

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