# name
Immigration enforcement visibility and consumer spending

# metadata.dc.description.abstract[].value
We exploit the sharp escalation in community-based ICE enforcement following the January 2025 inauguration to estimate the causal effect of immigration enforcement on consumer spending. Using Synthetic Difference-in-Differences with cross-state variation in surge intensity as the identifying variation, we find that states experiencing the largest enforcement surges saw aggregate card spending decline by 1.7 percentage points relative to their SDiD counterfactual, an effect robust to covariate adjustment, alternative shock windows, and pre-tariff truncation. Null estimates for non-in-person spending rule out a broad regional demand shock, while null estimates for jail-based arrests (enforcement invisible to surrounding communities) isolate enforcement visibility as the operative mechanism. Sector-level estimates reveal two empirically distinct channels: in states with Democratic governors, aggregate spending fell by −4.1 pp (p < 0.01), driven by large declines in Accommodation and Food Services (−2.3 pp) and Arts, Entertainment, and Recreation (−7.3 pp), consistent with behavioral withdrawal from public commercial life in jurisdictions where community enforcement was most visible. In Trump-voting states, Home Improvement Centers and Transportation and Warehousing spending fell by −3.8 pp (p < 0.1) and −3.0 pp (p < 0.01) respectively, consistent with labor supply disruption among undocumented workers in construction and logistics. Our results indicate that the economic costs of enforcement extend well beyond the directly targeted population and depend critically on whether enforcement is visible to the surrounding community — not merely on its scale.

# metadata.dc.rights[].value
cc-by-nc-nd, (c) De Balanzo et al., 2026

# metadata.dc.source[].value
IEB (Institut d’Economia de Barcelona) – Working Papers

# metadata.dc.title[].value
Immigration enforcement visibility and consumer spending