Arnold Kling  

Immigration

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Economists, Non-economists, an... Don't Call Me Stupid...

I write,


On the issue of poverty and immigration, which Robert J. Samuelson raised, I would ask, "Where would you prefer that people be poor?" That is, do we want to insist that poor Hispanics should remain in their native countries, because we want to make our own national statistics on health insurance coverage and poverty look better?

One can argue that we do not want poor immigrants coming to this country and competing with established citizens for jobs. However, in our globalized world, our established citizens are going to feel competition from foreigners, whether those foreigners immigrate or not.


In my view, economists have to be relatively favorable toward immigration, just as we have to be relatively favorable to free trade in general. It's our job to lean against xenophobia.

UPDATE: Joel Kotkin writes,

All told, European immigration to the United States jumped by some 16 percent during the 1990s. Europe's percentage of total immigrants to the U.S. rose crisply between 1998 and 2001. Visa applications dropped after 9/11, but then increased last year by 10 percent. The total number of European-born Americans increased by roughly 700,000 during the last three years, with a heavy inflow from the former Soviet Union, the former Yugoslavia, Romania, and France.

...St. Louis is another city that has benefited enormously from European immigration--in its case, the growth of a Bosnian community now estimated at well over 10,000. Since the Bosnians' appearance on the city's south side, they have transformed their neighborhoods. South Grand Avenue, once a dying thoroughfare, has been turned by entrepreneurial-minded newcomers into a major center of Bosnian commerce. In typical American style, the community is gradually spreading to the city's sprawling suburbs.


Kotkin concludes with a note that should be filed under "revealed preference."

Beneath the European hostility toward America stirred up by 9/11 and the Afghan and Iraq wars, a much deeper verdict on the United States is being rendered by hundreds of thousands of individual Europeans. These men and women, some of their continent's most energetic residents, are uprooting themselves for brand new lives in America.

Further update: on the topic of immigration and wages, see this post from Chris Dillow from awhile back.



TRACKBACKS (9 to date)
TrackBack URL: http://econlog.econlib.org/mt/mt-tb.cgi/368
The author at Mike Linksvayer in a related article titled Against xenophobia writes:
    Three cheers for Arnold Kling: “Where would you prefer that people be poor?” That is, do we want to insist that poor Hispanics should remain in their native countries, because we want to make our own national statistics on health insuran... [Tracked on September 26, 2005 3:28 PM]
The author at Cold Spring Shops in a related article titled A THOUGHT FOR THE DAY. writes:
    Provided the incentives are conducive to allocative efficiency? Discuss. [Tracked on September 26, 2005 8:12 PM]
The author at Heritage Tidbits in a related article titled The U.S. Economy: ‘Driven by the Energies of People Who Can Still Dream’ writes:
    Joel Kotkin, author of The City: A Global History, penned an noteworthy article for The American Enterprise on the increase in European immigration to the United States over the past ten to fifteen years. (Thanks to Arnold Kling at EconLog... [Tracked on September 28, 2005 11:02 PM]
COMMENTS (25 to date)
Jon writes:

Arnold, the reason people are less open to immigration is the same reason economists spend more of their money on their own children's education than they do on others. We value our own children more than our neighbors'; our neighbors' children more than those throughout the rest of our country; and children in our country more than those in others.

Ian Lewis writes:

Arnold,
I am curious, is there a number of immigrants that would make you change your mind? 50 million, 100 million, 500 million?

Steve Sailer has spoken at least once about the number of people around the world that are much poorer than we are but could get here fairly easily (even with their few resources). The number could be well over 600 million.

So many of the people that are Pro-Immigration are fairly wealthy and benefit quite a bit from increased competition in the lower classes.

And, before anyone thinks that I am anti-immigrant, my mother is an immigrant and still speaks with a thick accent.

All the best.

Robert writes:

In some respects, a larger number of poor people is also beneficial to the poor, because there is a larger market, and greater economies of scale to be had, in providing goods and services to poor people.

If the poor collectively are a significant market, then the market contains greater incentives for providing goods and services to them in ways that lessen the "frictional barriers" that hinder their escape from poverty.

jaimito writes:

Poverty is not only a material parameter, poor people tend to have other undesirable qualities, apart from their lack of money. For a healthy economy, we need a growing population, thus moderate immigration is a necessity. But only people like me should be allowed in.

Christian Brunnström writes:

Stereotype Answer:
Ok, a drive towards a more free-flow of resources, in this case human capital and labor; a rise in supply of labor which should drive the price of labor to decrease (opening up of markets; new equilibrium) which means salaries, but it's far from having an omni-effect but surely concentrated on low-skill jobs. Natives should not worry about an increased competition for jobs (even if they should; good, that would push up quality -increased competition), and surely what they really fear, is seeing foreigners with jobs that themselves choose not to accept, instead choosing to eat live for free with social unemployment benefits. Immigration = enlargement of the market (increase in tax-income) and generation of the economy.

John P. writes:

My only concern is that too large an influx of immigrants over too short a period could lead to a (further?) dismantling of the U.S. wealth-making machine. I realize that this is a fear that hate-mongers have played upon since this country was founded, but at some point the numbers really could become large enough that people who don't "get" the U.S. could remake it in some other, less desirable form.

Ivan Kirigin writes:
“In some respects, a larger number of poor people is also beneficial to the poor, because there is a larger market, and greater economies of scale to be had, in providing goods and services to poor people.”

As a practical matter, the government-provided resources for the poor will not grow, as the tax base is largely empty of the poor. The services would either cost a far greater percentage of tax revenue, or the quality would decrease.

While I would normally be an advocate of unlimited immigration (let all 6 billion in if they want), there needs to be a few changes. Firstly, they should not come here looking for a handout from the government. While those programs were designed to help the poor, I’m sure they have hurt more people in the end if immigration has been forced to decrease out of budgetary necessity. School would also need to change. Government administration is not flexible enough for anything, including increased immigration, but a government subsidized voucher program would incite a large growth in non-English schooling.

Here is a question: what would increase the quality of life more for the poor: removing all trade barriers and working to eliminate the foreign nations’ bad economic policies, OR increasing immigration without changing government programs like welfare, medicare, schools, etc.

Randy writes:

Our "feelings" about immigration are pretty much irrelevant. Its happening, and short of draconian methods which we no longer have the guts to use, there is nothing we can do to stop it. The population of the US has doubled in my lifetime. I expect that it will double again before I die. And I'm fine with that - because not being fine with it has no value.

Ivan Kirigin writes:

"because not being fine with it has no value."

If there are negative consequences to immigration out of control in the presence of market warping government programs (and the disruption caused simply by their "illegal" status), there is value in lessening the flow.

This is caused, in a democracy, by people who can say, "we need more legal immigration, and a strong restriction on illegal immigration."

The only useless activity is doing nothing (except for things like accumulating compounding interest :)

Randy writes:

Ivan,

Re; "...there is value in lessening the flow.

Perhaps, but it isn't going to happen. We don't have the guts to do it.

Who's gonna stand on those walls? You Lieutenant? Who's gonna start shooting illegals crossing the border? Or rounding up and deporting the millions already here? I'm not. And apparently no one else is either.

Bud1 writes:

More Immigrants...Keeps the housing bubble from bursting.

Timothy writes:

And Social Security from dying. Hrm...maybe stemming immigration would be a good way to finally kill the SS demon.

Mr. Econotarian writes:

It isn't just a matter of where people will be poor, the fact is that as people move from countries with less economic freedom to higher economic freedom, they will become more productive, enhancing global wealth.

It is also possible that the enhanced intercourse between the countries with less economic freedom and the US may lead to economic reforms in those developing countries.

I really do believe, for example, that El Salvador has been positively moved forward in economic reform from the large number of Salvadorans working in the US and sending back money and culture. Dollarization, which locks in a stable currency and lowered local interest rates in El Salvador, is one of the results.

Of course, El Salavador also gained gang warfare from returning Salvadoran kids from L.A. after the end of the civil war, and has now re-exported it to the US as MS-13...

I'd like to see you specifically deal with this story: Mexico building political beachhead in U.S. An IL state Sen. wants to also serve on Mexico's "Institute for Mexicans Abroad": That raises the peculiar prospect of the Cicero Democrat offering policy advice in an official capacity to Mexican Cabinet members while creating laws in Illinois...

Peculiar indeed! The word "economics" doesn't just mean financial matters, at least as far as I understand it. It implies taking all matters into account, and that would dealing with a foreign government continually attempting to meddle in our laws.

Further, 40% (I forget the exact figure) of Mexico's population says it would move to the U.S. if it could.

And, from an earlier poll, 58% of Mexicans in Mexico said that the U.S. southwest rightfully belongs to Mexico.

Obviously, there's much more to this issue than just dollars and cents, or xenophobia vs. "give us your tired." Anyone who ignores or papers over those other factors isn't helping their credibility.

I've got hundreds of posts about these matters, as well as a search function if anyone would like to know more.

spencer writes:

I look at the recent surge in immigration to the US as being largely a "demand-pull" development.

This implies that the reason immigration is high is that our economy is demanding the labor provided by immigrants and that we are better off because of it.

This way of looking at the problem would also explain why no one can find the negative impact on wages that many keep looking for.

But as an economists one should look at why has immigration increased in recent years. Has there been a big shift in US-Latin american living standards? I doubt it. The same for Western Europe even though the US has experienced stronger growth in recent years. But most of the big increase in European immigration seems to be from Eastern Europe, so it could just be that the opportunity to immigrate did not exist under communism. But Eastern Europeans are also moving to Western Europe, so it could still be demand pull in both cases.

But, can our hosts or their readers come up with reasons why the surge in immigration is not demand pull.

In the late 1800s period of strong immigration there was considerable evidence that it was strongly influenced by the business cycle-- surging in booms and contracting in recessions.
This provides evidence that the 1880s was an example of demand-pull immigration.

So why shouldn't that be true today?

jaimito writes:

But, can our hosts or their readers come up with reasons why the surge in immigration is not demand pull?

If you have two connected vessels and water is flowing from one to the other, we dont talk about push nor pull, it is a disequilibrium. If people is moving from one place to the other, there is a disequilibrium and a connection allowing the movement of the people.

I am not sure what the disequilibrium actually is about, maybe it is relative GNP per capita, GNP growth in the last 10 years, unemployment, attractiveness of the girls, percieved chances of getting laid, availability of drinking water, average summer temperature, number of Szatmar hassidim per square kilometer, number of rich and generous relatives at one hour bus ride, demand for bright intelligent boys, demand for stupid but hardworking imbeciles, civil war at home, price of ticket, availability of reliable coyotes, or some other index or combination of indices.

Regarding the surge in immigration, what are you talking about? Immigration peaked 5 years ago. I have no idea who is pulling or pushing people around.

Steve Sailer writes:

Dr. Kling writes: "In my view, economists have to be relatively favorable toward immigration, just as we have to be relatively favorable to free trade in general. It's our job to lean against xenophobia."

For some reason, I had the impression that economists' jobs were to tell the truth to the best of their ability, not to "lean" against (or for) any particular political values.

William Woodruff writes:

I have a revolutionary idea. Let the neo-cons (whom are bent on changing the governments of the world )change the government of Mexico. This would rid the country of corruption and scandal, and the disequilibrium which draws Mexican nationals over US borders, would disappear.

William

John S Bolton writes:

Has there been set up a false dilemna; as between mass immigration and xenophobia? Public economic policy should maximize the per capita income and wealth of the citizen, not that of the world. It should not act as if valuing an increase in the aggression upon the net taxpayer. Mass antimerit immigration cohorts will certainly increase the aggression on the net taxpayer in the welfare state, and this is economically dysfunctional. An attempted economic diagnosis of a phobia, while being unwarranted in itself, also implies that there are no rational arguments against deliberately increasing the parasitization on the net taxpayers; as if we could expect to produce more per capita through increasing the burden on the net taxpayer.

jaimito writes:

Dr. Kling writes: "In my view, economists have to be relatively favorable toward immigration, just as we have to be relatively favorable to free trade in general. It's our job to lean against xenophobia."

Right.

But Steve Sailer thinks Xenophobia is a political value and economists should be neutral about it. Wrong. Xenophobia, like trade barriers, has definite economic effects. Should economists be against prosperity?

The real problem is that Americans are not producing enough children to maintain a growing economy. Decaying population is unadviceable from an economic point of view. Immigration is a necessity. You want a White only policy? Even Australia abandoned that idea long time ago, probably because there was not enough White people going around .

Steve Sailer writes:

Australia's legal immigration system has a point system for choosing which immigration applicants would most benefit the existing citizenry and for excluding the ones who would be a net drain on the citizenry. Further, Australia cracks down hard on illegal immigration.

From an economic standpoint, this is much more rational than the American system, but American economists, with the exception of Harvard's George Borjas, almost never talk about it. How come?

Rich writes:

A couple of people have made the argument that we are stuck with a large illegal inflow because there is not adequate national will or resources to deport them. But you don't have to deport anybody. Serious prosecutions of people and businesses who hire illegal immigrants would have a huge deterrent effect. Throw a couple of soccer moms in jail for hiring illegal maids and nannies and you'll likely see a big migration out of the U.S..

Dezakin writes:

"Public economic policy should maximize the per capita income and wealth of the citizen, not that of the world."

Right; But coincidentally these two are not in opposition. There is little that enriches the globe that impoverishes except emmigration; of either labor or capital.

Australias policy on immigration is hardly more rational. The country is in need of far more immigrants than she lets in.

Ann writes:

Dr. Kling writes: "In my view, economists have to be relatively favorable toward immigration, just as we have to be relatively favorable to free trade in general."

Are you talking about legal or illegal immigration? Tolerating illegal immigration requires selective law enforcement. Who should be allowed to decide when to apply laws and when to conveniently overlook them (and for whom)? There's bound to be some selective enforcement already, but it's far more pervasive if we tolerate widespread illegal immigration.

I would expect most economists to value the rule of law - without it, putting optimal policies in place won't help. And supporting illegal immigration is inconsistent with supporting the rule of law.

wkwillis writes:

We could let the immigrants vote as soon as they arrive. They can cut wages for poor people, they can raise taxes for rich people?

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