Effects of Immigration Legislation on the Arizona Labor Market

This paper uses Arizona Senate Bill 1070 as a natural quasi–experiment to study the effect of a negative labor supply shift of undocumented immigrants on the labor market in Arizona. Using individual-level data from 2009 and 2012 provided by the Census Bureau, I use a difference-in-differences regression design with New Mexico as a control for non-state specific effects such as recovery from the Great Recession during this time period. To accurately calculate effect size and confidence, a simultaneous estimation model is used to reduce selection bias in addition to a minor extension of a previous estimator of marginal effect in similar nonlinear models. I find negative effects on wages, suggesting that undocumented immigrants are labor compliments