In answering these broad questions, the panel faced a complex set of theoretical and empirical issues. Immigration affects the economy not only through labor markets, but also through the relative prices of goods, capital flows across national borders, international trade in goods and services, and the supply of entrepreneurs or risk-takers. Moreover, in the labor market, immigration acts through changes in sheer numbers, as well as in the age, sex, educational attainments, occupational skills, and fluency in English of the immigrants. These changes are manifest not only in changes in wages but also in changes in the rates of employment and unemployment of the native-born.
The panel also focused on the assimilation of immigrants into the labor market, an issue that is important for several reasons: the degree of assimilation helps to determine the long-run labor market effects of current immigration; it affects the fiscal impact of immigration through governmental revenues and expenditures; and it influences how well the immigrants adapt culturally. Studying this issue called for looking at the types of jobs and occupations that immigrants start with in the United States, at their occupational mobility, at their wages relative to those of native-born workers, and at their success in integrating into American society over time.
In considering fiscal impacts, the panel assessed the contributions that immigrants make to revenues as well as to costs. Furthermore, we did not confine our study to the net impact in a single year; rather, we focused on the fiscal impact over the immigrants' life cycle and over those of their descendants.
What about the effects of immigration on the size, distribution, and composition of the nation's population? Immigration affects the population, again not only through its numbers, but also through emigration, intermarriage, childbearing, and mortality. Thus the panel studied the distribution of the population in terms of geography, age, ethnicity, family composition, and immigrant generations. Shifts in the age or geographic distribution of the population impinge on the fiscal balance; changes in ethnicity or family composition alter the social and cultural scene. And the changes immigration brings about are different depending on whether it is legal or illegal.
To address these questions, the panel met regularly beginning in 1995. These meetings were characterized by lively, vigorous discussion of existing research on immigration and the interpretation of these empirical studies. Where the current literature was deficient, the panel had background papers prepared to synthesize available studies or to present new frameworks and evidence. This volume draws on these papers, which were discussed at a conference in September 1996 and which will be published by the National Academy Press. The topics addressed include the labor market role of female immigrants, the historical role of immigration, a theoretical framework for addressing the fiscal impacts of immigration, the association of immigration with criminal activity, and the theoretical labor market impact of immigration.
Regarding the fiscal impact of immigration, the panel relied on an ongoing