IT CAN be hard to work out the net impact of immigration on wages, especially in cities with bustling economies. The only way to try to tease out causality from coincidence is by hunting for a “natural experiment”: a historical event that is something like the randomised controlled tests scientists would conduct in a lab. For immigration, one such useful event is the Mariel boatlift of 1980.
For all its woes now, Cuba was an even tougher place 36 years ago for dissidents and economic strivers. Fidel Castro’s government persecuted citizens for their political beliefs, and barred most Cubans from emigrating. But in April 1980 Mr Castro decided that tensions in his country had grown too severe, and opened an escape valve. He declared that any Cubans who wanted to leave were free to go, provided that they left by the port of Mariel. Some 125,000 Cubans took up his offer that year, most of them heading for Miami.
As the newcomers arrived, Miami’s workforce grew by 55,000, or 8%, almost at once. The marielitos were mostly low-skilled: around 60% lacked high-school degrees, and just 10% were college graduates. In theory, a supply shock of this magnitude might have been expected to depress the wages of workers already in Miami, particularly the poorly-educated, at least in the short run. But the empirical evidence has been mixed. In 1990 David Card, an economist now at the University of California, Berkeley, looked at the bottom quartile of workers in Miami and concluded that the Mariel boatlift had had “virtually no effect” on the wages of low-skilled non-Cubans. He also found no evidence of increased unemployment. His paper was highly influential.
Twenty-six years later, Mariel is in the policy spotlight once again. A forthcoming paper by George Borjas, an economist at Harvard, revisits the boatlift and contradicts Mr Card’s conclusion. By using a slightly different definition of low-skilled worker—high-school dropouts—he found that their wages fell precipitously after the influx of labour in 1980, both in absolute terms (see chart) and relative to other workers in Miami. A similar decline could be observed after 1995, after a second wave of immigration from Cuba.
It remains hard to generalise from either set of results. Mr Card’s study suggested that reality may not agree with researchers’ intuitions; Mr Borjas’s paper shows that empirical results may depend on exactly where researchers look.
This article appeared in the United States section of the print edition under the headline "Wages of Mariel"
