Media Briefings

AMNESTIES FOR UNDOCUMENTED MIGRANTS speeds up their integration into the labour market

  • Published Date: April 2014

The possibility of gaining legal status through an immigration amnesty may considerably speed up the labour market integration of newly arrived undocumented immigrants in the host country. That is the central finding of a new study by Carlo Devillanova, Francesco Fasani and Tommaso Frattini, presented at the Royal Economic Society’s 2014 annual conference.

The researchers have analysed a unique dataset on undocumented immigrants in Italy before and after the 2002 Italian amnesty. They find that the prospect of legalisation leads to an increase of about 30% points in the employment rate of undocumented immigrants, which amounts to two thirds of the employment growth normally experienced during the first year in the host country. Furthermore, the amnesty boosts immigrants’ employment rate even before they acquire legal status.

Co-author Francesco Fasani comments:

‘By granting an amnesty, governments generate an economic surplus, mainly due to the positive value that immigrants and prospective employers attach to the prospect of legalisation.

‘Our study suggests that different types of amnesties may change the distribution of this surplus among different agents – undocumented immigrants, employers and government.

‘In particular, our results indicate that much of the surplus accrues to the employers. Whatever the political stance on the right allocation of this surplus, this is an aspect that should be taken into account when designing regularisation programmes.’

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The possibility of acquiring legal status through an immigration amnesty may considerably speed up the labour market integration in the host country of newly arrived undocumented immigrants.

The prospect of legalisation leads to an increase of about 30 percentage points in the employment rate of undocumented immigrants, which amounts to two thirds of the employment growth normally experienced during the first year in the host country.

Remarkably, the amnesty boosts immigrants’ employment rate even before immigrants acquire legal status.

This study is based on a unique dataset on undocumented immigrants in Italy, and analyses the natural experiment provided by the 2002 Italian amnesty.

Undocumented immigration is widespread in most developed countries. For example, the United States is currently debating the future of its estimated stock of nearly 12 million unauthorised immigrants. Large stocks of unauthorised immigrants are also residing in Europe, where the latest estimates point at an undocumented population ranging between 1.9 and 3.8 million individuals, with between 400 and 860 thousand of them residing in the UK alone.

Immigration amnesties are a frequently used policy tool to deal with undocumented immigration. But amnesties may have different designs across and within countries. Eligibility for legal status may depend exclusively on some predetermined conditions (such as a minimum period of continuous residence in the host country) or it may also include some employment and/or occupation requirements, either at the time of the application or in the past.

In the context of the current US debate on migration policy, if a common consensus seems to have emerged on the superiority of ‘earned legalisations’, there is still an open discussion on what exactly ‘earned’ would imply in terms of legalisation requirements.

Despite their pervasiveness, little is known about the effect of amnesties on the welfare of the undocumented immigrants themselves, as well as on the effects of different amnesty designs. Indeed, most research so far so focused on the 1986 US IRCA legalisation, ignoring the heterogeneity in legalisation programme design.

This study has several important implications for immigration policy design:

· It is the first study to show how the prospect of legal status has labour market effects even before legalisation actually occurs, and suggests that these changes may be permanent.

· It demonstrates that the pre-legalisation effects may run in an opposite direction to those occurring after legalisation.

· It illustrates how the imposition of an employment requirement at the time of application may substantially alter employers’ and immigrants’ behaviour.

· It shows that temporary migration schemes that condition permit renewal on being in employment may induce immigrants to considerably lower their reservation wage.

Francesco Fasani, one of the co-authors of the study, says:

‘By granting an amnesty, governments generate an economic surplus, mainly due to the positive value that immigrants and prospective employers attach to the prospect of legalisation.

‘Our paper suggests that different types of amnesties may change the distribution of this surplus among different agents – undocumented immigrants, employers and government.

‘In particular, our results indicate that much of the surplus accrues to the employers. Whatever the political stance on the right allocation of this surplus, this is an aspect that should be taken into account when designing regularisation programmes.’

ENDS

Notes for editors:

‘The prospect of legal status increases the employment probability of undocumented migrants’ by Carlo Devillanova (Bocconi University), Francesco Fasani (Queen Mary, University of London) and Tommaso Frattini (University of Milan)

For further information, contact:

Carlo Devillanova, carlo.devillanova@unibocconi.it, +39 02 5836 5342

Francesco Fasani, f.fasani@qmul.ac.uk, +44 020 7882 5869

Tommaso Frattini, tommaso.frattini@unimi.it, +39 02 503 21535

Romesh Vaitilingam: romesh@vaitilingam.com, +44 7768 661095