Legal versus illegal U.S. immigration and source country characteristics.

• Author: Bratsberg, Bernt

1. Introduction

   Both legal and illegal immigration to the United States surged over the last two decades. Between 1971 and 1991, the number of legal immigrants soared from 370,478 to 1,827,167 per year [26].(1) For illegal immigration, a number of studies estimate the volume of both the flow and the stock of migrants. While there is some disagreement regarding these numbers, generally accepted figures on the stock of illegal immigrants give ranges of 2 million to 4 million in 1980, and 3 million to 6 million in 1986 [4; 10]. Empirical studies of population growth conclude that the net population increase due to illegal immigration ranged from 100,000 to 300,000 per annum between 1980 and 1986 [29]. And despite the intent of the Immigration Reform and Control Act (IRCA) of 1986, there is no indication that the yearly flow of illegal immigrants has decreased since the passage of the act [8; 9].

   The immigration literature devotes much attention to estimating the size of the illegal immigrant population and to assessing the impact of both legal and illegal immigration on the welfare of the native-born population,(2) and a number of studies address the determinants of the volume of immigration.(3) However, due to lack of reliable data, few empirical studies examine the determinants of illegal immigration flows to the United States.(4) In particular, no empirical study has yet addressed the variation in the volume of illegal immigration across source countries. Such a study is important for a number of reasons.

   First, at a conceptual level, the literature uncovers serious contradictions in the way the profession views illegal immigration. For example, the theoretical approaches of Fogel [14] and Ethier [12] have fundamentally different implications regarding the relationship between the volume of illegal immigration and source country earnings. An empirical analysis of the relationship provides a test of these theoretical approaches. Second, an examination of the differential impact of underlying determinants on legal and illegal immigration flows adds to our understanding of international migration flows. Chiswick [6] raises this point, and implicitly calls for a systematic comparison of the impact of determinants when he hypothesizes that illegal immigration is more elastic with respect to migration cost than is legal immigration. Third, a quantitative assessment of the causal relationships between source country characteristics and the volume of illegal immigration is important for purposes of evaluating policies directed at stemming illegal immigration flows.

   Based on micro data from the Immigration and Naturalization Service (INS) on legal immigrants as well as on legalization applications that followed the passage of IRCA, this study exploits the variation in legal and illegal immigration flows across seventy source countries to examine the sensitivity of immigration flows to underlying source country characteristics. The study finds that earnings in the source country and the distance from the United States form significant deterrents of both legal and illegal immigration flows. We also find that illegal immigration is more sensitive to such factors than is legal immigration. For example, while the elasticity of legal immigration with respect to source county earnings is close to zero, for illegal immigration the relationship is close to unit elastic.

   The study also makes contributions to the recent policy debate regarding the impact of the North America Free Trade Agreement (NAFTA) on U.S. immigration from Mexico. We find that both legal and illegal immigration flows from Mexico are highly responsive to GNP growth in Mexico. For example, a 10 percent increase in Mexico's GNP will reduce legal immigration by 6.3 percent and illegal immigration by perhaps as much as 10.3 percent.

2. Legal and Illegal U.S. Immigration Flows

   To assess the volume of legal and illegal immigration to the United States, this study uses data drawn from both unpublished and published statistics from the U.S. Immigration and Naturalization Service (INS), as well as the public use tapes "Immigrants Admitted into the United States as Legal Permanent Residents (various fiscal years)" also available from the INS. Table I reports the estimates of legal and illegal immigration flows to the United States by continent-of-origin, as well as separately for seventy foreign countries.

   For legal immigration flows, we focus on immigrants who arrived in the United States between 1975 and 1980. Unfortunately, published statistics on immigrant admissions between 1975 and 1980 include some immigrants who entered the United States before 1975, and exclude some immigrants who entered within that time-frame but adjusted visa status at a later date.(5) From the published immigration statistics, we therefore net out persons who had entered the United States as non-immigrants or refugees before 1975, and add persons who were admitted as immigrants between 1980 and 1986 but had entered the United States as non-immigrants or refugees between 1975 and 1980. Column 2 of Table I reports the resulting number of legal immigrant arrivals in the United States. In total, roughly 2.6 million legal immigrants entered the United States between [TABULAR DATA OMITTED] 1975 and 1980. The majority arrived from Asia and North America (43 percent and 31 percent), with Mexico (13 percent), the Philippines (8 percent), and Korea (6 percent) forming the major source countries.

   We use the amnesty applications resulting from the Immigration Reform and Control Act of 1986 as measures of illegal immigration flows to the United States. The act contained two provisions under which illegal immigrants could apply for amnesty, I-687 and I-700. While the I-687 provision required that the illegal immigrant had resided in the United States since before 1982, the I-700 (or SAW for seasonal agricultural worker) provision contained no requirement regarding length of stay in the United States. The SAW provision required instead that the illegal immigrant could document recent employment in U.S. agriculture. Columns 3, 4, and 5 of Table I report the number of amnesty applications processed by the INS as of 9 May 1989. By that date, the INS had processed a total of 2.9 million amnesty applications, of which 60 percent were based on the I-687 provision and 40 percent on the I-700 (SAW) provision. The majority of the amnesty applicants originated in North America (89 percent), with Mexico (75 percent) again serving as the major source country.

   The last two columns of Table I list estimates of the legal and illegal immigration flows as percentages of the source country population. We compute the percentages by dividing the measures of legal and illegal immigration flows (Columns 2 and 3) by the 1977 population of the foreign country. Using this metric, Jamaica becomes the major source country for legal immigrants (3.64 percent), with other large legal immigrant flows originating in Trinidad and Tobago (2.61 percent) and the Dominican Republic (1.53 percent). Similarly, El Salvador (3.72 percent) and Mexico (3.50 percent) are the major source countries of illegal immigrants, with Guatemala (1.07 percent) and Haiti (1.05 percent) also supplying substantial illegal immigrant flows.

   The columns reporting legal and illegal immigration as percentages of the source country population...