Immigration Restrictions as Active Labor Market Policy: Evidence from the Mexican Bracero Exclusion

An important class of active labor market policy has received little impact evaluation: immigration barriers intended to raise wages and employment by shrinking labor supply. Theories of endogenous technical advance raise the possibility of limited or even perverse impact. We study a natural policy experiment: the exclusion of almost half a million Mexican bracero farm workers from the United States to improve farm labor market conditions. With novel labor market data we measure state-level exposure to exclusion, and model the absent changes in technology or crop mix. We fail to reject zero labor market impact, inconsistent with this model.