Association for Public Policy Analysis & Management

In the absence of comprehensive federal immigration reform, almost all states have taken a more active role in setting policy with respect to unauthorized immigrants.  Some states have enacted legislation and implemented other policy actions that place greater restrictions on unauthorized immigrants. These include expanding local law enforcement involvement in enforcing federal immigration laws, mandating that employers verify work eligibility, prohibiting access to discounted tuition for otherwise eligible unauthorized immigrants, blocking eligibility for state driver’s licenses, and excluding access to publicly subsidized prenatal care and child health insurance. At the same time, other states have taken the opposite course and adopted policies with the reverse intent relative to the status quo: divorcing immigration status from access to in-state tuition and allowing eligibility for state-issued driver’s licenses and access to subsidized health care. Still other states have adopted a mixture of these policies.

State-level immigration-related policies are typically motivated by concerns for the size of the unauthorized immigrant population in a state, competition in the labor market between unauthorized immigrants and other workers and the use of public services by unauthorized immigrants.  However, it is important to recognize that policy impacts may accrue in multiple policy domains; and may affect stakeholders different from the ones targeted by the policies.

We develop a cost-benefit framework for classifying the potential impacts of specific policies. Our objective is to provide a framework for undertaking a comprehensive assessment of the full range of potential policy impacts and for determining the costs and benefits in aggregate and for specific stakeholders in the public and private sectors. The framework relies on determining the set of effects that a policy may have and how those effects create costs or benefits for the following stakeholders: unauthorized immigrants, authorized immigrants, non-immigrants, and state and local governments. Aggregating across stakeholders provides the societal perspective of the costs and benefits of any given policy.

We identify the expected changes, based on theoretical considerations and other empirical evidence, in the number of unauthorized immigrants in the state and other key economic and social outcomes, as well as the implications for state and local government budgets. We then review empirical studies that have examined the causal impact of the policy as implemented.

Indeed, both theoretical predictions and empirical findings indicate that impacts may be found in the size of the unauthorized population in the state; the level and distribution of state economic activity; the labor market in terms of the level of employment and wages, employment composition, and the relative wages across worker subgroups based on skill; primary, secondary, and postsecondary education in terms of enrollment and attainment; law enforcement and the criminal justice system; the social welfare system; population health and utilization of health care; and state and local government taxes and expenditures. We use the empirical findings to incorporate that research into the cost-benefit framework. We also conduct our own empirical analyses to fill in gaps where possible.