Immigrants, Minorities, and Labor Market Competition

This paper investigates the extent of labor market competition among immigrants, minorities, and the native population. An analysis of 1980 U.S. Census data reveals that immigrants tend to be substitutes for some labor market groups and complements for others. The effects of shifts in immigrant supply on the earnings of native-born men are, however, very small. On the other hand, increases in the supply of immigrants do have a sizable impact on the earnings of immigrants themselves: an increase of 10 percent in the supply of immigrants, for example, reduces the immigrant wage by about 10 percent.