The Effects of Immigration on the U . S . Economy
graph shows that at two periods , the interaction term of lawful permanent residents and recession begins to impact the unemployment rate . There are slight increases and decreases , but none of significance . The first graph shows the most impact , which reaffirms the previous research regarding the impact of recessions on the inflow and outflow of immigration .
Figure 3a provides the results of the impact of immigration on CPI . The first highlighted graph on the left side in Figure 3a shows that at two periods , CPI starts impacting the interaction term of lawful permanent residents . This is a significant impact . At three periods , it begins to increase , followed by a slight decrease , leading to an increase at six periods . At 10 periods , it appears to plateau . The second highlighted graph on the right side shows that at two periods , there is a slight increase in the log form of lawful permanent residents , followed by a slight decrease then a plateau . The third highlighted graph shows a substantial decrease and increase between zero and four periods , but it ultimately plateaus as well . This suggests that CPI and poverty rate are endogenous and that there is a causal relationship between CPI and lawful permanent residents ; this again supports the literature on the endogeneity between immigration and economic growth .
Figure 3b shows the results of the effects of immigration on the urbanization index . The first highlighted graph shows that at two periods , there is an impact of FDI on the poverty rate . There is a slight increase and decrease and an apparent plateau at 10 periods . The second highlighted graph is more significant . At one period , we see a sharp increase , followed by a sharp decrease at two periods , increase at five periods , and a slow decrease at six periods . The third highlighted graph also shows a shock to the urbanization index at two periods , which causes an increase in the poverty rate . There is a continued decrease and increase throughout each period .
This shows that urbanization has a pronounced impact on poverty rate ; more so than FDI , which again supports the research that , as immigrants move to a city , poverty rates increase . FDI and lawful permanent residents have an impact , but not that great , which supports the hypothesis that FDI and lawful permanent residents have a positive effect on the U . S . economy .
The time series analysis provides some evidence that foreign-born individuals ( lawful permanent residents ) have a positive impact on the U . S . economy ; it further adds to the literature that immigration is an important part of the United States via the economy . It also provides evidence that FDI has an impact on the U . S . economy . We have seen that FDI increases the top marginal tax rate and decreases the poverty rate .
Now we want to look at a more systematic approach to the effects of immigration on the U . S . economy by analyzing the results from cross-sectional and time series data . We look at immigration and the U . S . economy by state , from 2010 to 2017 .
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