This week's hot international economics topic: immigration, and specifically the Deferred Action for Childhood Arrivals (DACA) order. Let's not get too far ahead of ourselves with the course material (we will analyze migration later in the course), and instead stick to basic individual cost-benefit analysis. Taking a rational choice perspective, the decision to migrate hinges on (1) the net benefits of staying; and (2) the net benefits of leaving (to a particular destination). In other words, there are push factors (reasons to leave) and pull factors reasons to choose a particular destination.
In the rollout of the DACA phaseout yesterday, Jeff Sessions stated, “The effect of this unilateral executive amnesty, among other things contributed to a surge of minors at the southern border with humanitarian consequences.” Let's analyze the plausibility of this theoretically, then see what the evidence says. At first blush it seems there should be no doubt that a program like DACA would cause an influx of new migrants hoping to qualify for it. It gives new minor children - especially teenagers - a sort of legal status that might qualify them to work legally in the US later on. On closer inspection it is not so clear. The law requires minors to be in school, meaning they cannot work to support themselves. It also makes their immigration status uncertain since, as an executive order, it is something that a subsequent administration can - and now apparently will - revoke. So the duration of the minor migrant's trip might be longer (because they are legal and do not face fear of ICE) or shorter (because since they are registered a policy reversal makes deportation almost certain). Hence, the immigrant trades one source of uncertainty for another.
Catalina Amuedo-Dorantes, a well-known immigration economist, along with her coauthor Thitima Puttitanun, find a negligible effect on apprehensions of minors to be attributable to DACA. Most of the recent rise in minors coming to the US comes from a 2008 law to help combat human trafficking and assist victims of trafficking, and from families fleeing increased in violence in Mexico.
70% of DACA recipients are in receipt of or are pursuing a Bachelor's Degree and earn an average of $37,000 a year according to Derek Thompson of The Atlantic,they aren't able to take advantage of any government welfare programs, even though they pay into them, wouldn't this lead to a loss of revenue into the government? Wouldn't this have an adverse effect on GDP?
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