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cover of episode The long view of economics and immigration (Two Indicators)

The long view of economics and immigration (Two Indicators)

2024/11/20
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Key Insights

Why did the Chinese Exclusion Act have unintended economic consequences?

The act led to a 64% reduction in Chinese labor, causing a 28% decline in White male labor supply as economic vitality drained from towns. This resulted in a drag on economic growth until 1940.

How did the Chinese Exclusion Act affect the labor market in the western U.S.?

The act reduced the Chinese labor supply by 64%, leading to a 28% decline in White male labor supply as economic vitality drained from towns, causing a drag on economic growth.

What are the five contributions immigrants make to economic growth?

Immigrants contribute through talent, consumption, taxes, investment, and innovation. They fill labor gaps, increase demand for goods and services, pay taxes, attract foreign investment, and start businesses, fostering innovation.

How does immigration affect local economies through consumption?

Immigrants increase aggregate demand for goods and services, introducing new categories of products and services due to their different tastes and preferences, which stimulates local economies.

Why might undocumented immigrants have a limited economic impact compared to documented immigrants?

Undocumented immigrants often face legal barriers that limit their ability to fully contribute to the economy, such as starting businesses or accessing certain jobs, which restricts their economic impact.

What role does innovation play in the economic contributions of immigrants?

Immigrant inventors are responsible for one in three U.S. patents, and nearly half of Fortune 500 firms were founded by immigrants or their children, highlighting their significant role in driving innovation.

How does immigration policy impact foreign investment in the U.S.?

An increase in immigrants from a particular country makes a U.S. state 50% more likely to receive investment from that country, creating an immigration-investment-jobs triangle that boosts local economies.

Chapters

The episode explores the economic impact of mass deportations by examining the Chinese Exclusion Act of 1882 and its unintended consequences on the western U.S. economy.
  • The Chinese Exclusion Act reduced the Chinese labor supply by 64%.
  • White male labor supply in the west also declined by 28%.
  • Economic vitality in towns drained due to the loss of Chinese immigrants.
  • The act led to a slowdown in manufacturing output and the number of businesses.

Shownotes Transcript

Mass deportations. What would actually happen—economically—if the President-elect follows through on promises to deport millions of people from America.We don't have to guess.Today we have two stories from Planet Money's daily podcast, The Indicator. First, the story from another time the US cracked down on immigration with the expressed intent of helping the economy. We look at how that worked out. And then we distill 20 years of research on immigrants and economic growth. What does immigration do for an economy? What types of immigration help? And who benefits?*Our most recent newsletter goes into more depth on some of this. Part one) of two here. Subscribe to our newsletter here).**This episode is hosted by Adrian Ma, Darian Woods, and Wailin Wong. These episodes of The Indicator were originally produced by Cooper Katz McKim and Julia Ritchey, and engineered by Kwesi Lee and Maggie Luthar. They were fact-checked by Angel Carreras and Sierra Juarez. Kate Concannon is The Indicator's Editor.Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts) or at plus.npr.org/planetmoney).*Learn more about sponsor message choices: podcastchoices.com/adchoices)NPR Privacy Policy)