Munich Personal RePEc Archive

An Economic Analysis on The Social Cost of Illegal Immigration

Van, Germinal and Orellana, Jose (2021): An Economic Analysis on The Social Cost of Illegal Immigration.

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Abstract

The purpose of this paper is to analyze the economic cost of illegal immigration in the United States since the 1990s and its consequences on American society. Indeed, illegal immigration has been a major topic of discussion among the main social issues during election cycles in the United States. Those who lean more conservative have argued that illegal immigration is an externality that increase social cost. They argue that illegal immigrants increase the cost of healthcare, public education, and welfare programs such as Medicaid and food stamps. And the cost falls on the American taxpayer. Those who lean more liberal argue that the government should create social programs to assist illegal immigrants in helping them adjusting and conforming their immigration status to the laws and customs of the United States. This paper has two objectives: (1) to determine if illegal immigration imposes a higher social cost on the American taxpayer based on a multivariate regression analysis, (2) to propose recommendations to help the illegal immigrants becoming legal while minimizing the future social cost of illegal immigration on the American taxpayer. Our findings show that there is a correlational relationship between illegal immigration and the cost of social welfare, and this correlational relationship is of strong magnitude.

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