By Xi Huang (University of Central Florida)
With decades of deindustrialization and the hard hit of the Great Recession, Detroit is characterized by urban blight, racial tension, residential segregation, and poverty. The region’s leaders have tried several countermeasures including economic diversification and “eds and meds” anchoring, and immigrant attraction appears to have become a sought-after strategy to address the region’s economic and demographic declines. This study examines whether this strategy has brought desirable outcomes, mainly focusing on the efforts led by Global Detroit that started in 2010. Using the synthetic control method that compares Detroit to a synthetical Detroit between 2011 and 2014, it finds that the immigrant-welcoming efforts have increased the immigrant share of the population in the Detroit region during the post-intervention period of 2011-2014. The share of high-skilled immigrants in the local population also increased during this time, albeit with weak statistical significance.
Using immigration and immigrants as an economic development tool has become popular in recent decades across American cities, especially among rustbelt cities. Struggling with dwindling local resources and tax revenues, rustbelt cities have sought to find a cost-efficiency way to bring back entrepreneurship, jobs, and economic activity. Additionally, in some cities and regions, scarcity of immigrants has been regarded as a primary reason for their poor economic growth. In this context, immigration is not only a developmental goal but also a key economic development tool as localities and regions working to reposition and rebrand themselves as a diverse and global metropolis.
In 2010, the Global Detroit initiative was created by a coalition of local actors across sectors and municipal boundaries. It aims to strengthen Detroit’s appeal to international talent and capital with four types of programs and strategies. First, it aims to attract and recruit international talent through mentorship and employment assistance programs such as the Global Talent Retention Initiative of Southeast Michigan. Second, it promotes immigrant entrepreneurship by connecting immigrant communities and potential business owners to small business services. Third, it strives to cultivate a welcoming environment for immigrants and refugees through programs such as Welcome Mat Detroit and Cultural Ambassador. Fourth, it seeks to strengthen the community-building potential of immigrants by promoting refugee resettlement and entrepreneurship in previously distressed neighborhoods.
Research has suggested that immigrants are responsive to the overall local policy climate but has yet to examine the demographic effects of immigrant-welcoming and integration programs. As such, this study employs the synthetic control method developed by Abadie, Diamond, and Hainmueller (2010; 2015), which is particularly useful for case studies with a small number of treated and control units. The synthetic control method uses a data-driven approach to construct an artificial comparison unit that best resembles the treated unit in the pre-treatment period. Matching on pre-treatment outcomes ensures an unbiased estimate of the treatment effect even when there are unobserved time-varying confounders.
In this study, a weighted average of regions without immigrant welcoming policies constitutes the synthetic Detroit. The post-treatment differences between Detroit and synthetic Detroit show that the Global Detroit initiative increased the foreign-born share by an average of 0.45 percentage points in the post-treatment years. Several falsification checks show that the results are robust to placebo implementation years and different specifications of synthetic Detroit. This study also examines two additional demographic outcomes: the share of high-skilled immigrants and the share of low-skilled immigrants in the local population. The results indicate that the high-skilled immigrant share increased by an average of 0.18 percentage points per year as a result of Global Detroit. However, the effect on the low-skilled foreign-born is statistically insignificant.
These results lend justifications to the local pro-immigration activism. The positive effects of the initiative seem to suggest that the development-inclusionary efforts may actually achieve promising outcomes, and immigration could be a viable tool to boost human capital in the rustbelt. Such initial demographic outcomes are desirable to local pro-immigration organizations and advocacy groups. Also, as the literature substantially agrees that immigration growth leads to robust local economies, the effects could be taken positively by development-minded growth coalitions in a neoliberal post-industrial and post-recession age.
Abadie, Alberto, Alexis Diamond, and Jens Hainmueller. 2010. “Synthetic Control Methods for Comparative Case Studies: Estimating the Effect of California’s Tobacco Control Program.” Journal of American Statistical Association 105(490): 493-505.
Abadie, Alberto, Alexis Diamond, and Jens Hainmueller. 2015. “Comparative Politics and the Synthetic Control Method.” American Journal of Political Science 59(2): 495-510.
Xi Huang is an assistant professor in the School of Public Administration at the University of Central Florida. Her research interests include immigration and migration, urban and community development, and policy analysis and evaluation. Her work has appeared in peer-reviewed journals such as Journal of the American Planning Association, Health & Place, Urban Studies, Urban Affairs Review, Journal of Urban Affairs, Regional Science and Urban Economics, among others.