Rethinking The Effects Of Immigration On Wages

This paper asks the following question: what was the effect of surging immigration on average and individual wages of U.S.-born workers during the period 1990-2004? The authors emphasize the need for a general equilibrium approach to analyze this problem. The impact of immigrants on wages of U.S.-born workers can be evaluated only by accounting carefully for labor market and capital market interactions in production. Using such a general equilibrium approach they estimate that immigrants are imperfect substitutes for U.S. - born workers within the same education-experience-gender group (because they choose different occupations and have different skills).