Abstract

Too often, undocumented immigrants are excluded from policies and social benefits that would allow them to participate in our society. For example, Republican representative Rand Paul proposed to exclude undocumented taxpayers from the Covid stimulus package because he viewed their inclusion as a burden. More importantly, Rand Paul frames the exclusion of undocumented immigrants as an efficient policy practice. However, in recent years, some states have adopted policies that permit undocumented immigrants to obtain driver’s licenses. Scholars have found that giving undocumented immigrants drivers licenses positively affects personal disposable income. Beyond this finding, there is limited research on the economic impacts of these state-level policies. This study contributes to the literature by examining the impacts of offering driver’s licenses to undocumented immigrants on state-level gross domestic product (GDP). Using state-level data and a difference-in- difference model, this study finds that offering driver’s licenses to undocumented immigrants has no statistically significant effect on a state’s GDP. Additionally, this study proposes a novel microeconomics framework for conceptualizing and analyzing the multiple pathways through which access to driver’s licenses for the undocumented can affect freedom and, in turn, a wide range of socioeconomic impacts for individuals, households, communities and state’s economies.

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