Of the estimated 11.1 million unauthorized immigrants in the U.S., 1.1 million are children. Due to differential treatment in the labor market, teenage undocumented immigrants face low returns to schooling. To measure the effect of legal status on the educational choices of Hispanic teenagers, we compare siblings who differ in their legal status due to their birth country. We find teenagers who were born in Mexico are 2.6 percentage points more likely to be out of school than their U.S. born siblings. Alternative explanations, such as differences in prenatal or childhood environment, appear largely unable to explain this result, suggesting that legal status has a significant impact on schooling decisions. Accounting for these alternative explanations to the extent possible and using proxies for legal status in U.S. census, we show that being undocumented reduces the number of years of high school by between 0.13 and 0.17 years. Back-of-the-envelope estimates suggest that providing legal status increases an undocumented worker’s lifetime wages by $8,455 and his lifetime net government fiscal contribution by $4,257, with estimated aggregate impact across all undocumented Hispanics over 75 years of $20 billion in increased earnings and $9 billion in increased fiscal contribution.
The goal of the National Tax Journal (NTJ) is to encourage and disseminate high quality original research on governmental tax and expenditure policies. Articles published in the regular March, June and September issues of the journal, as well as articles accepted for publication in special issues of the journal, are subject to professional peer review and include economic, theoretical, and empirical analyses of tax and expenditure issues with an emphasis on policy implications. The NTJ has been published quarterly since 1948 under the auspices of the National Tax Association (NTA).
Founded in 1907, NTA is the leading association of tax professionals dedicated to advancing understanding of the theory and practice of public finance. The National Tax Association is a nonpartisan, nonpolitical educational association that fosters study and discussion of complex and controversial issues in tax theory, practice and policy, and other aspects of public finance. NTA is a 501(c)(3) organization and does not promote any particular tax program or policy. The enormous public benefit that can come from sound tax policy and wise administration is a prime reason for the work of NTA.
This item is part of a JSTOR Collection.
For terms and use, please refer to our
Proceedings. Annual Conference on Taxation and Minutes of the Annual Meeting of the National Tax Association
© 2017 National Tax Association