A major concern with immigrants coming into the United States is that they adversely affect domestic workers through job competition and wage depression. We study the displacement and wage reduction effects of immigrants in California vegetable production, which is labor intensive, and 95% of the farmworkers in California are immigrants. Our findings show that this concern is not valid in vegetable production because the addition of one new immigrant displaces only 0.0123 domestic workers, and wage reduction is inconsequential. But one immigrant worker increases the vegetable production by $23,457 and augments the productivity of skilled workers, material inputs, and capital by $11,729.
