Harvard labor economist George Borjas has written a study pointing out that wages in Miami among high school dropouts got hammered by the Mariel Boatlift.
The Wage Impact of the Marielitos: A Reappraisal
George J. Borjas
ABSTRACT
This paper brings a new perspective to the analysis of the Mariel supply shock, revisiting the question and the data armed with the accumulated insights from the vast literature on the economic impact of immigration. A crucial lesson from this literature is that any credible attempt to measure the wage impact of immigration must carefully match the skills of the immigrants with those of the pre-existing workers. The Marielitos were disproportionately low-skill; at least 60 percent were high school dropouts. A reappraisal of the Mariel evidence, specifically examining the evolution of wages in the low-skill group most likely to be affected, quickly overturns the finding that Mariel did not affect Miami’s wage structure. The absolute wage of high school dropouts in Miami dropped dramatically, as did the wage of high school dropouts relative to that of either high school graduates or college graduates. The drop in the relative wage of the least educated Miamians was substantial (10 to 30 percent), implying an elasticity of wages with respect to the number of workers between -0.5 and -1.5. The analysis also documents the sensitivity of the estimated wage impact to the choice of a placebo. The measured impact is much smaller when the placebo consists of cities where pre-Mariel employment growth was weak relative to Miami.
This shouldn’t be too surprising since Miami high school dropouts in 1980 were heavily African-American, and Miami blacks were notoriously angry about the changes in their city after Mariel, rioting three times in the 1980s.
But who cares about poor African Americans? It was a good time in Miami to be a lawyer, banker, real estate developer, or all-purpose businessman with connections, such as Jeb Bush, who moved to Miami in late 1980.
COMMENTS:
* The problems of black America cannot be solved, and certainly not by whites. Yet it’s not hard to visualize economic and social policies that would improve the situation of blacks, largely by incentivizing constructive behavior and penalizing antisocial behavior. Many of these policies would also better the lots of poor Americans, unlucky Americans, shrinking-middle-class Americans, and left-side-of-the-bell-curve Americans.
Instead, our society’s elites double down on policies that benefit them and theirs.
Brazil is an inspiring model, if you are in the 1% and indifferent to asabiyah. Perhaps everyone else should be a bit more bothered by declining black wages.
* White tourists pay for prostitutes. Only Americans were banned from traveling to Cuba. Plenty of tourists from Canada and Europe.
Cubans only make about $30 a month. As of 2005 most blacks were unemployed. That’s why so many black/mulatto women go into prostitution. Blacks don’t get remittances from the states. They don’t own any of the mansions to operate businesses out of. Few blacks work in the tourism industry where they can make money in tips. Most of what blacks do to earn money is considered illegal so the prisons are 85 percent black. There are great economic disparities between the races.
