The Labor Market Effects of a Refugee Wave: Synthetic Control Method Meets the Mariel Boatlift
AbstractWe apply the synthetic control method to re-examine the wage and employment
effect of the Mariel Boatlift, a large inflow of Cuban refugees to Miami in 1980. This method improves on previous studies by choosing a control group for Miami so as to best match its labor market features in the eight years before the Boatlift. Given the presence of significant measurement error for average city wages we emphasize the importance of using the May-ORG CPS sample rather than the March-CPS. The first includes a more reliable measure of weekly wages, has larger sample size and smaller measurement error. Analyzing wages and unemployment rates we find no significant departure between Miami and its control between 1980 and 1983. Using the March-CPS data, however, one could find negative wage effects in small subsamples after 1979 as pointed out in George Borjas (2015a). However those estimates are imprecise and very sensitive to the choice of sample and of the outcome variable.