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The Immigration Debate: Studies on the Economic, Demographic, and Fiscal Effects of Immigration
TABLE 5-5 How the Aggregate Fiscal Impact Depends on the Definition of the Study Population (1994 in 1994 $ billions)
A. Aggregate Fiscal Impact
Study Population:
Overall
Federal
State and Local
1. Immigrants Only
32.4
28.2
4.2
2. Immigrant Households
-13.3
16.0
-29.3
3. Immigrants and Concurrent Children
29.5
48.9
-19.3
4. Immigrants and Concurrent Descendants (Children and Grandchildren
23.5
v
v
B. Population Subtotals Study Population:
Number
Cumulative Total
1. First Generation
22,766,711
22,766,711
2. Second Generation under age 20
8,201,368
30,968,079
3. Concurrent Second Generation age 20 and over
5,597,759
36,565,838
4. Concurrent Third Generation
3,862,610
40,428,448
B. Population Subtotals
Study Population: Number Cumulative Total
Number
Cumulative Total
1. First Generation
22,766,711
22,766,711
2. Second Generation under age 20
8,201,368
30,968,079
3. Concurrent Second Generation age 20 and over
5,597,759
36,565,838
4. Concurrent Third Generation
3,862,610
40,428,448
Immigrant households include nearly all immigrants, plus nearly all U.S.-born children of immigrants up to the age of 20 or so, because such children will co-reside with their immigrant parents. Expanding the definition to include immigrants plus their U.S.-born children under the age of 20, the estimated fiscal impact flips from $32 billion to -$13 billion. The biggest change is at the state and local levels, where the impact shifts from $4 billion to -$29 billion. Evidently it makes a decisive difference which of the two most common demographic formulations of the problem is used. Measured impacts are strongly positive for immigrants only and strongly negative overall for immigrant households.
The bias from excluding the adult U.S.-born children of immigrants, together with their children, becomes apparent when we recompute and take them into account. When we count all the relevant descendants of still-living immigrants we find a net positive fiscal impact of about $24 billion. There is a very large positive fiscal impact of $51 billion at the federal level, partially offset by a large negative fiscal impact of -$27 billion at the state and local levels. Looking separately at the federal, state, and local components, we find that at the state and