The effect of immigrant admission criteria on immigrant labour-market characteristics

The skill levels of immigrants entering the USA has declined in recent decades; however, most immigrants to the USA continue to be admitted on the basis of family contacts, without reference to labour-market characteristics. This situation has given rise to a debate about the criteria on which immigrants are admitted or excluded. I examine how the relative skill levels of immigrants admitted under different criteria vary by country of origin, those criteria being the possession of highly-valued skills and family connections. Using data from the Immigration and Naturalization Service, Borjas' 1987 model is tested. The results show (a) that the relative skill levels of the two groups do indeed differ by country of origin, and (b) the pattern by country of origin is consistent with the Borjas predictions. The policy implication is that the effects of changing admission criteria will differ by country of origin, but in a predictable way.