The Economic and Political Effects of Immigration: Evidence from the Age of Mass Migration

Abstract

Between 1850 and 1920, during the Age of Mass Migration, more than 30 million Europeans moved to the United States. European immigrants provided an ample supply of cheap labor as well as specific skills and know-how, contributing to American economic growth. These positive effects were not short-lived, but are still evident in the 21st century: areas of the United States that received more European immigrants during the Age of Mass Migration have higher income per capita, a more educated population, and lower poverty rates. Despite its economic benefits, immigration triggered hostile political reactions, which were driven by cultural differences between immigrants and natives, and culminated in the introduction of country-specific quotas. In contrast to the concerns prevailing at the time, European immigrants eventually assimilated. The process was facilitated by the inflow of 1.5 million African Americans who left the rural South to move to northern and western cities between 1915 and 1930. Black in-migration increased the salience of skin color, as opposed to that of religion and nativity, as a defining feature of in- and out-groups of the society. This reduced the perceived distance between native whites and European immigrants, thereby facilitating the integration of the latter. European immigrants also had long-lasting effects on American ideology. Parts of the country that hosted more immigrants during the Age of Mass Migration have a more liberal ideology and stronger preferences for redistribution well into the 21st century. This resulted from the transmission of political ideology from (more left-leaning) immigrants to natives.