Leah Boustan on Streets of Gold: America's Untold Story of Immigrant Success

Video and Slides

On Thursday, June 16, Leah Bouston joined Markus’ Academy for a lecture. Boustan is a Professor of Economics at Princeton University.

Watch the full presentation below. You can also watch all Markus’ Academy webinars on the Markus’ Academy YouTube channel.

Timestamps:

[0:00] Introductory remarks
[6:17] The need to debunk immigration myths
[15:35] Myth 1: An unprecedented flood of immigration
[26:38] Myth 2: Immigrants today are not as successful as previous generations
[32:14] Myth 3: Immigrant families and their children stuck in permanent underclass
[46:19] Myth 4: Immigrant success comes at the expense of the U.S. born

Executive Summary

• [0:00] Introductory remarks. What do Einstein, Gödel, von Neumann, Morgenstern have in common? All of them immigrated to Princeton, USA, fleeing Nazi Germany, transforming the science community in USA. There are many stories of immigrant success but reasons are not obvious (selection, hard work, ….). Also, the benefits of immigration are not spread equally across society and may differ from country to country. 
• [6:17] The need to debunk immigration myths. The early twentieth century was not as easy a time to be an immigrant as many now believe, the myth of the “streets of gold.” Using a larger dataset of census data and linking people over time across census periods, we can get a better understanding of the development of immigrant success today, rather than the biggest success stories or failures. 
• [15:35] Myth 1: An unprecedented flood of immigration. While we have more immigrants now than before, the percentage of immigrants relative to the U.S. population is at levels similar to the late 19th and early 20th centuries (14 percent of the population). The immigrant share did drop due to policy decisions in between these waves of immigration. It is a longer process now to become a U.S. citizen than it was in earlier times. In the former wave of immigration, there were fewer restrictions on immigrants, who were largely coming from Europe, and were not the most well-off or highly educated. In the more recent wave of immigration, people have come primarily from Asia and Latin America. There are limited visas available these days, meaning that many immigrants are undocumented (without papers). Also, immigrants tend to be more educated than others from their home country (“educated few”). 
• [26:38] Myth 2: Immigrants today are not as successful as previous generations. Many immigrants in the past (1900-1920) were not as poor as we sometimes assume, and those were immigrants that we would see having a lot of success in later sampling. On the other hand, immigrants that were coming in poorer did not have the noticeably higher earnings later on; in contrast to prior academic literature, this suggests that the Ellis Island generation did not have this “rags to riches” story to the extent we often imagine.
• [32:14] Myth 3: Immigrant families and their children stuck in permanent underclass. Looking at the children of immigrants from families with lower total family income showed that this “second generation” has been likely to be upwardly mobile, both now and in the past. To control the study, the research focused on the children of immigrants and U.S.-born raised at the 25th percentile of family income. The same patterns in the data emerged as was seen in the 1880 or 1910 census: almost every country had a higher level of income than the children of U.S. born parents, with many averages reaching close to the 65th percentile when the U.S. average is around the 45th percentile. These patterns often disappear when controlling for location, suggesting that the immigrant decision to move to urban centers often caused a higher future income for their children. 
• [46:19] Myth 4: Immigrant success comes at the expense of the U.S. born. This is a common myth, that immigrants steal jobs and reduce wages from U.S. born; yet, immigrants are consumers, are more likely to contribute to innovation, and most of the jobs that immigrants take are jobs often done by other immigrants. Looking to the 1920s immigration restrictions, there is no real change in income from different levels of quota exposure (exposure to the 1920s border closure). We do not need to pre-select immigrants based on wealth or education level– the U.S. needs people with varying education levels. Immigrants’ willingness to move often means that they can serve as some sort of insurance for U.S. born to equilibrate the markets during economic downturn. In the U.S., refugees have integrated faster than non-refugees, a pattern untrue in Europe. Going forward, U.S. policy could increase the immigration cap, which would have many benefits for the U.S.