New Immigrants' Location Choices: Magnets without Welfare

Neeraj Kaushal, Columbia University

The 1996 welfare reform banned legal non-citizens, who arrived in the US after August 1996, from receiving federally financed means-tested benefits in their first five years in the US. However, a number of states restored some benefits using state-level funds. I use this state-level variation in policy to study whether or not new immigrants make their location decisions on the basis of benefit generosity. I use a conditional logit model to obtain estimates of the effect of the policies of interest. To control for time-varying, unmeasured state characteristics, I use a difference-in-differences procedure. I find that safety-net programs do not affect the locational choices of new low-skilled women immigrants. This result is robust to a variety of specifications including those limited to the target group; difference-in-differences models with each of the control groups, and models that take account of the number of programs available to immigrants and generosity of benefits.