Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/233504
Authors: 
Colas, Mark
Sachs, Dominik
Year of Publication: 
2021
Series/Report no.: 
Discussion Paper No. 281
Abstract: 
Low-skilled immigrants indirectly affect public finances through their effect on native wages & labor supply. We operationalize this indirect fiscal effect in various models of immigration and the labor market. We derive closed-form expressions for this effect in terms of estimable statistics. Empirical quantifications for the U.S. reveal that the indirect fiscal benefit of one low-skilled immigrant lies between $770 and $2,100 annually. The indirect fiscal benefit may outweigh the negative direct fiscal effect that has previously been documented. This challenges the perception of low-skilled immigration as a fiscal burden.
Subjects: 
Immigration
Fiscal Impact
General Equilibrium
JEL: 
H20
J31
J62
J68
Document Type: 
Working Paper

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