THE RECENT immigration waves to Europe and the U.S. have generated a heated political debate, and proposals to introduce or tighten immigration restrictions are becoming increasingly common. A growing body of literature has shown that the inflow of immigrants has bolstered support for populist, right-leaning parties in several Western democracies but, despite the rising importance of immigration in the political arena, the causes and the consequences of anti-immigration sentiments are not understood fully.
Furthermore, there only is scant evidence on the link between support for anti-immigration parties and the actual policies implemented in response to immigration. Since we ultimately care about the actions and the reforms undertaken by political actors, it is crucial to understand which policies, if any, are affected by immigration and for what reasons. Will legislation regulating the immigration regime be introduced? Will redistribution and taxation be changed to prevent immigrants from having access to public goods?
When it comes to the causes of the rising anti-immigration sentiments, two main hypotheses have been proposed. The first one is economic in nature and argues that political discontent emerges from the negative effect of immigration on natives' employment and wages. While this idea is consistent with some findings in the literature, it is in contrast with other results documenting that immigrants have a negligible or even positive impact on natives' earnings.
The second hypothesis for natives' backlash is cultural in nature. Both today and in the past, a recurring theme in the rhetoric of anti-immigration politicians is that immigrants' cultural diversity is an obstacle to social cohesion and a menace to the values of hosting communities. Historical and anecdotal accounts present many examples of cultural opposition to immigration. Even though local amenities (e.g., crime level or school quality) have been shown to be important determinants of natives' reactions to immigration, there is scant evidence on the extent to which culture directly triggers political backlash.
I study in a unified framework the political and economic effects of immigration across U.S. cities between 1910-30, a period when the massive inflow of European immigrants abruptly was interrupted by two major shocks, World War I and the Immigration Acts of 1921 and 1924. Between 1850-1915, also known as the Age of Mass Migration, more than 30,000,000 people...