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The Impact of the Mariel Boatlift on the Miami Labor Market

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The Impact of the Mariel Boatlift on the Miami Labor MarketDavid CardIndustrial and Labor Relations Review, Vol. 43, No. 2. (Jan., 1990), pp. 245-257.Stable URL:http://links.jstor.org/sici?sici=0019-7939%28199001%2943%3A2%3C245%3ATIOTMB%3E2.0.CO%3B2-ZIndustrial and Labor Relations Review is currently published by Cornell University, School of Industrial & Labor Relations.Your use of the JSTOR archive indicates your acceptance of JSTOR's Terms and Conditions of Use, available athttp://www.jstor.org/about/terms.html. JSTOR's Terms and Conditions of Use provides, in part, that unless you have obtainedprior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content inthe JSTOR archive only for your personal, non-commercial use.Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained athttp://www.jstor.org/journals/cschool.html.Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printedpage of such transmission.The JSTOR Archive is a trusted digital repository providing for long-term preservation and access to leading academicjournals and scholarly literature from around the world. The Archive is supported by libraries, scholarly societies, publishers,and foundations. It is an initiative of JSTOR, a not-for-profit organization with a mission to help the scholarly community takeadvantage of advances in technology. For more information regarding JSTOR, please contact [email protected]://www.jstor.orgWed Jun 27 22:35:26 2007THE IMPACT OF THE MARIEL BOATLIFT ON THE MIAMI LABOR MARKET DAVID CARD* Using data from the Current Population Survey, this paper describes the effect of the Marie1 Boatlift of 1980on the Miami labor market. The Marie1 immigrants increased the Miami labor force by 7%, and the percentage increase in labor supply to less-skilled occupations and industries was even greater because most of the immigrants were relatively unskilled. Nevertheless, the Marie1 influx appears to have had virtually no effect on the wages or unemployment rates of less-skilled workers, even among Cubans who had immigrated earlier. The author suggests that the ability of Miami's labor market to rapidly absorb the Marie1 immigrants was largely owing to its adjustment to other large waves of immigrants in the two decades before the Marie1 Boatlift. 0NE of the chief concerns of immigra- natives. Second, the locational choices of tion policy-makers is the extent to immigrants and natives presumably de-which immigrants depress the labor mar- pend on expected labor market opportu- ket opportunities of less-skilled natives. nities. Immigrants tend to move to cities Despite the presumption that an influx of where the growth in demand for labor can immigrants will substantially reduce native accommodate their supply. Even if new wages, existing empirical studies suggest immigrants cluster in only a few cities (as that the effect is small. (See the survey by they do in the United States), inter-city Greenwood and McDowell [I9861 and migration of natives will tend to offset the studies by Grossman [1982], Borjas [1987], adverse effects of immigration. and Lalonde and Tope1 [1987].) There are These considerations illustrate the diffi- two leading explanations for this finding. culty of using the correlation across cities First, immigrants have, on average, only between wages and immigrant densities to slightly lower skills than the native popu- measure the effect of immigration on the " lation. Thus, econometric studies based on labor market opportunities of natives. They the distribution of the existing stock of also underscore the value of a natural ex- immigrants probably understate the effect periment that corresponds more closely to of unskilled immigration on less-skilled an exogenous increase in the supply of im- migrants to a particular labor market. The experiences of the Miami labor The author is Professor of Economics, Princeton market in the aftermath of the Marie1Cniversity. He thanks George Borjas, Alan Krueger, Bruce Meyer, and seminar participants at Princeton Boatlift form one such experiment. From University for their comments. Mav to Se~tember 1980. some 125,000 A data appendix with copies of the computer , 1 Cuban immigrants arrived in Miami on a programs used to generate the tables in this paper is flotilla of privately chartered boats. Their available from the author at the Industrial Relations Section, Firestone Library, Princeton University, arrival was the conseauence of an unlikelv 1 Princeton, SJ 08544. sequence of events culminating in Castro's Indu~trial and Labor Helnttons Reutew, Vol. 43, So. 2 (January 1990). 0by Cornell University 0019-7939190/4302 $01 .OO246 INDUSTRIAL AND LABOR RELATIONS REVIEW declaration on April 20, 1980, that Cubans wishing to emigrate to the United States were free to leave from the port of Mariel.' Fifty percent of the Marie1 immi- grants settled permanently in Miami. The result was a 7% increase in the labor force of Miami and a 20% increase in the number of Cuban workers in Miami. This paper summarizes the effects of the Boatlift on the Miami labor market, focusing on wages and unemployn~ent rates of less-skilled workers. The analysis is based on individual micro-data for 1979-85 from the merged outgoing rota- tion group samples of the Current Popu- lation Survey (CPS). Three features of the Marie1 incident and the .Census data greatly facilitate the analysis. First, the CPS sample of the Miami metropolitan area is relatively large: roughly 1,200 individuals per month. Second, a comprehensive picture of the Miami labor market in the months just before the Marie1 Boatlift is available from the 1980 Census, which was conducted on April 1, 1980. Finally, unlike most other ethnic groups, Cubans are separately identified in the CPS questionnaire. Thus, it is possible to estimate wage rates, unemployment rates, and other economic indicators for both Cubans and non-Cubans in the Miami labor market, and to measure the effects of the Marie1 immigra- tion on the two groups separately. Overview of the Miami Labor Market Before the Boatlift For at least a decade prior to the


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