Umesh Gautam

We develop a theoretical model to analyze the impacts of deporting undocumented workers and implement it empirically for US vegetable production, which employs low-skilled domestic, guest, and undocumented workers, along with high-skilled workers, materials, and capital. The results show that removing 1,000 undocumented workers leads to a negligible increase in low-skilled domestic employment (59 workers) and an annual wage increase of $57 per worker, indicating very limited but positive labor-market adjustment. In contrast, reduced labor availability lowers vegetable output by $35.07 million and reduces returns to complementary inputs. Moreover, removing half of the undocumented workforce reduces vegetable output by $2.55 billion.

This study develops a nested constant elasticity of substitution production model to examine the effects of stricter immigration enforcement on U.S. fruit production. The model distinguishes domestic, H-2A guest, and undocumented low-skilled workers, alongside high-skilled labor, materials, and capital. Stricter enforcement reduces undocumented employment, and additional domestic and guest-worker employment only partly compensates for the loss. As a result, fruit output falls and output prices rise. The study also examines how labor- and capital-augmenting technological improvements can mitigate production losses under tighter enforcement.