Because the DREAM Act would lead more immigrants to graduate from high school and college, it would also increase tax revenues and reduce government expenses. This positive fiscal impact is likely to be quite large. For example, based on estimates in a 1999 RAND study, an average 30-year-old Mexican immigrant woman who has graduated from college will pay $5,300 more in taxes and cost $3,900 less in criminal justice and welfare expenses each year than if she had dropped out of high school. This amounts to a total annual increased fiscal contribution of more than $9,000 per person.
The increased fiscal contribution would repay the required educational investment within a few years and thereafter would provide a profit to taxpayers for several decades. Some of those helped by the DREAM Act would be encouraged to graduate from high school but would not go on to college. These, too, would greatly increase their fiscal contribution in the years and decades to come. Almost half, or about $4,200, of the annual increased contribution of
the average 30-year-old Mexican immigrant woman discussed above is due to high school graduation. The rest is attributable to the effects of college attendance and graduation.

Beyond fiscal impact, the DREAM Act would benefit the economy by significantly increasing the income of affected immigrants, thereby stimulating spending and investment. Again using numbers from the RAND study cited above, the average Mexican immigrant woman who graduates from college as a result of the DREAM Act instead of dropping out would likely increase her pretax income at age 30 by more than $13,500 per year. All of these calculations are based solely on the educational advancements that the DREAM Act would make possible. The income and fiscal contribution of DREAM Act students would increase an additional amount due to their newly legalized immigration status and consequent ability to work legally. Studies of the 1986 Reagan-era legalization program showed a dramatic improvement in income for the newly legalized population. The cumulative impact of the DREAM Act on the economy could amount to hundreds of billions of dollars.