David R. Henderson  

Open Immigration: How Many Would Come?

Reply to David on Immigration... The Great Stagnation, Chapter ...

What I found most interesting in the comments on my latest post and in Bryan's response to my post was the wide range of views about how many immigrants would come to the United States in just a few years if the U.S. government dropped immigration restrictions except for those with dangerous communicable diseases or a criminal record.

I gave what I thought to be an upper estimate of 300 million in a couple of years. Most people who commented on this, including Bryan, thought it to be too high. It well could be too high, but I found the arguments for why it's too high largely unpersuasive. Let's consider them in turn.

. Bryan's argument: "I think rising rents and declining wages for low-skilled workers would lead to more modest rates. See New York City: Every American is free to move there, but low real wages and high rents convince most of us to live elsewhere."

Here's the problem: We've been free to move there for a long time. So there's an equilibrium. People are not free to move to the United States. That's why we're having this discussion. So the evidence from NYC is no evidence at all.

. eccdogg's argument: "The highest immigration rate ever was 1.4% of the population per year from 1847-1854. A time period with pretty much the policy you advocate.
US immigration would have to be over 5 times that rate to have 300MM immigrants come to the country over a 10 year period.
Granted that it is cheaper to immigrate now, but there would be substantial feedbacks lowering wages and thus the incentive to move that would keep it well under that number."

eccdogg identifies one problem with his own argument but leaves out an important problem. He points out that it's cheaper to immigrate now: that's the cost to the immigrant. The thing that has changed in a major way is the benefit. The potential immigrant will weigh this lower cost against the benefit. What is the benefit? Roughly, speaking, the difference (in purchasing power terms) between the unskilled wage here and the unskilled wage at home. This is a multiple of what it was in the 19th century.

Ryan Vann argues: "Seems you have an overactive imagination to me. Average immigration per year is about 2 million. This means that immigration levels would have to increase 75 times that number to get 300 million in two years. No way that happens."

Touche. But remember, Ryan, that you can't generalize from immigration flows when immigration is highly restricted to immigration flows when it's not. Here's how I can (perhaps overactively) imagine 150 million a year for two years: 70 million from Africa, 50 million from Asia, 20 million from Latin America, and 10 million from Europe, Canada, and Austrailia combined. Then do it again the next year.

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CATEGORIES: Labor Market

COMMENTS (21 to date)
eccdogg writes:

Actually I thought about the benefit as well, just didn't include it in my post.

Yes the wage differential is probably bigger now than then, but back then they were giving away free land. Id at least call that a push.

hutch writes:

maybe this was mentioned in the comments to previous posts, but is it physically possible to bring 70 m from Africa, 20 m from Asia, etc? how are they coming here? airplanes? boats? i can't see businesses building lots of new capacity. as a result, i would think prices for existing transportation would go up, restricting the ability of the poorest to get here quickly. maybe there is lots (LOTS!) of existing capacity not being utilized right now, but I can't see enough to take care of that many more people.

Jameson Burt writes:

You can favor open immigration without obscuring the number of immigrants.
Why look at 2 years?
As each ethnic group sets up its networks;
once in the U.S., that group can pay for their compatriots to come
-- they leverage themselves, gaining economies of scale.

How much will the population increase from open immigration in 30 years?
300 million seems likely.
One third of the population of Mexico came to the U.S., with some Mexican towns almost relocating.

Those who have lived at subsistence levels,
combined with their social networking,
could live at higher densities and lower rents than U.S. recent rents.
Consider most small towns; eg, in Nebraska.
Arcadia, NB, with 300 people has average house prices of $25,000.
Broken Bow, NB, with 3000 people has average house prices of $50,000.
Lincoln, NB, with 300,000 people has average house prices of $100,000.
Outside major U.S. cities, there are many habitable places with low rents.
Squatters live at even lower rents.

To say that open immigration would insignificantly increase the U.S. population over 30 years is almost equivalent to saying that the U.S. can't support a population as large as China's 1.3 billion people.
Suppose the "living standard" for each additional person in the U.S. far exceeds that for most of the world. With open boarders and ensuing social networking, wouldn't there be an osmosis to the better "living standard" in the U.S.?
I suspect this osmosis would continue until "living standards" more equalized.

One can argue that open immigration would benefit the U.S. economically, without obscuring that the U.S. population could more than double. Obviously the GDP would increase enormously. Such a population would then really make the U.S. an "exceptional" nation, with funds that could easily send a man to Mars or hold-up in Afghanistan perpetually.

ryan yin writes:

How restricted is migration from Australia, Canada, and western Europe? Obviously I don't have as much reason to know as you do, but my impression was that it wasn't terribly restricted relative to how many wish to come. You seem to be figuring it would jump an order of magnitude.

(OTOH, a standard model would say that if you assume the amount of unskilled immigration would absolutely explode, then skilled wages would increase in the short run, so that might push a lot more OECD migration. Is this what you had in mind?)

Fabio Rojas writes:

How about we use evidence? What is the largest short term migration ever? I think the recent record is probably the mass of people who fled East Europe during and after World War II. See this genealogy page: http://genealogy.lovetoknow.com/WWII_Wave_of_Immigration.

So under threat of immediate destruction and/or starvation after the war, about 15-20 million people fled Eastern Europe. What % of the population is that? If we use Germany 1940 as a base line, about 80 million, that's, maximum 25% of the population. It's a lower % of we use East Europe as a whole.

Mexico has about 112m, so a reasonable limit would be about 20-25 million - and that's under the assumption that people are being pushed in an extreme way. A more likely number is probably 10 million or so. That's the size of New York City. In other words, open borders, would result in one extra large urban area. I'm not worried.

To get David's upper extreme estimate of 300 million, you would have to empty out all of Mexico (112 million), all of central America (41 million), and about half of Brazil (190 million).

In other words, yes, we'd see a wave of immigration, but some of the number are pure fantasy.

David R. Henderson writes:

@ryan yin,
Immigration from Australia, Canada, and western Europe is just as restricted as immigration from other countries. I believe the quota is 20,000 a year from each country.

Peter writes:

I think there are two hypotheticals to look at here. First is an immigration policy that is more liberal than any in the history of mankind as far as I know. This would involve absolutely no restrictions or paperwork whatsoever to immigrate. I think 300 million MIGHT be plausible in this scenario, but even clearing 300 million extra people through the aviation and customs screening would be a tough logistical feat.

A more likely libertarian-acceptable policy would involve some basic restrictions on immigrants, without a numerical cap. So, for example, checking for criminal records/open warrants. Signing up for a Social Security card, presenting a few forms of ID, and maybe having enough funds to get by for a few months in the US after arrival. I figure that the logistical backlogs in implementing even this super-stripped-down immigration regieme would make us get about 10MM immigrants a year, with those immigrants who are most ready to come (such as those currently on a wait list or who would immigrate illegally now) being first.

Ryan Vann writes:

Obviously immigration numbers under current and open border regimes would differ, but we have to have a base number to go off of. I just don't think they would be that large. Maybe numbers would double, but an increase of 75x just doesn't seem reasonable. Why do I think this.

There are logistical as well as cultural barriers for that much immigration in such a short time frame. Who really wants to leave a place they have grown accustomed to unless there are huge potential gains to be had? Mass migration a country of origin for another country only occurs under extreme circumstances where either standard of living can be expected to increase dramatically (both in an absolute and relative sense), oppressive regimes cause mas exoduses, etc. Moreover, picking up all your belongings and heading off can also be costly.

300million is roughly 5% of the world's population. I just don't see that many picking up and coming to the US. Moreover, just because the US has open borders doesn't mean countries of origin would be so keen on letting nationals leave. I know trying to expatriate from the US is a pretty arduous process.

Furthermore, I see a US whose UE rate is at 9% or so, and I don't see that rate decreasing anytime soon. Where is the opportunity that generally induces folks to move here?

jiriki writes:

As a person living in a welfare state, I'd like to to move to USA to work in the IT Industry, atleast for a while.

I read some posts from a Finnish libertarian who moved to New Hampshire. Apparently the process is a bit crazy, lots of forms (~40 + copies make it over 100), examinations, interviews and so on. Biggest issue was apparently the uncertainty, and random response times from days to years for acceptance. Basically you've to to be academically educated or you might have to apply for the lottery, which is not a problem for me but I suppose it'd be for a lot of others who are not so fond about our marginal tax rates. Employers over-the-seas can get you the papers much more easily though.

Also apparently criticizing US foreign policy or war against drugs might cause Admin Review which could extend the time for 3 years. Don't quote me on that, not sure if that's an urban legend.

I worked in Ireland before and it was easy. Fly into the country, fill some papers to get social security numbers, bank accounts and you're all set.

MikeP writes:

First is an immigration policy that is more liberal than any in the history of mankind as far as I know.

Generously saying that states originated 10,000 years ago, approximately 99% of that history saw virtually every state with open borders.

Even the US had no restrictions on immigration at all until 1875, when convicts and prostitutes were made unwelcome, and 1882, when Chinese were. Immigration was not restricted in general -- i.e., using quotas -- until World War I.

David R. Henderson writes:

@Fabio Rojas,
Fabio's point is not responsive to mine. He focuses on Latin America. I focused on the world. The reason we're used to thinking in terms of Latin American immigration is that it's much easier to immigrate illegally by land. Open the borders, and we'll get many more people from Asia and Africa.

ChrisH writes:

It's important to keep in mind that current restrictions greatly skew the flow of immigration -- in both directions.

Many Mexican illegals have returned because of the recession. How many of the remainder would return, if they had confidence they could return in the future without risking great expense and perhaps their lives?

You envision a permanent population of immigrants. I think a majority would come, make enough to be a rich man back home (or start a business), and return.

The ones who stay will have revealed their preference for aspects of U.S. lifestyle other than the economic advantages. To that extent, they've shown their solidarity with "American values." Whether those values are reverence for the Constitution or obsession with celebrities, I don't know. But they're what we've got now, and that would just be amplified (with exotic accents!).

TimG writes:

MikeP wrote:

Even the US had no restrictions on immigration at all until 1875, when convicts and prostitutes were made unwelcome, and 1882, when Chinese were.

You mean legal restrictions. Just because it wasn't written down doesn't mean it would have been culturally/socially accepted or economically feasible. Look at the US, we forced Indians onto reservations and had slavery. Would we have really tolerated non trivial numbers on non-European immigrants during that time period?

I would say throughout most of human history population migrations involved violence, with winning side generally getting the land. I wouldn't call that open borders. Or imagine a family trying to migrate, for most of the last 10,000 years would they have even been able to get a map to know where they are going or what was there?

Steve Sailer writes:

You could test the Open Borders proposal using your own house. Just go down to skid row and hand out fliers with your address on it, saying "Come on in, doors are never locked!" You would quickly see a surge in your house's population, but after awhile, an equilibrium would be reached where you couldn't get any more homeless people to move in. Bums would reject your offer to let them live in your house, saying they've seen what your house is like these days, and that they would prefer to continue living in their refrigerator box in their nice, low traffic alley rather than at your house.

Fabio Rojas writes:

David, you make a good point,I read your post too quickly. But I still think 300 million in one year or two is utterly crazy. As another person noted, that's about 5% of the world's population. If you look at real examples of migration, you only get those levels during wars and famines. So you might get super high migration from, say, Haiti, but not from China, which is developing pretty well. I don't think India would produce such levels. It's improving too and it's pricey to get here.

Finally, let me make a utilitarian point. I live in Indiana. This place is empty. Basically it's one modest city + vast, vast farms. I would really welcome more people out here and the towns and shops they'd set up. I'd kill for a decent shish-kabob place or an Indian spice shop. We can easily fit 300 million in "fly over" country!

David R. Henderson writes:

Fabio Rojas,
Thanks. BTW, I agree with you about how large a boon to the economy 300 million immigrants would be.

Babinich writes:


By open immigration do you mean no restriction of movement whatsoever?

geckonomist writes:

You appear completely ignorant of recent European history and the free immigration rules within the expanded European Union.

If you compare the real income difference (even at ppp) between the poorest 20% Rumenians & Bulgarians and, let's say, the inhabitants of Luxemburg (=much richer than Americans!), in your mind you must argue that Luxemburg must be flooded with Bulgarians.
Luxemburgs (very generous) welfare state must be crumbling under east european immigration waves.

In reality, you'll not find many immigrants from those countries. Perhaps high rents, perhaps not too many low-skilled jobs on offer, language barriers, who knows.
Whatever the narrative, the empirical facts matter and they show where your hypothesis belongs: in the bin.

Moreover, Luxemburg already had by far the highest immigrant population (40% or so), yet these guys only seem to be getting richer instead of "voting away the system". Another hypothesis of yours that does not corresponds with the facts.

The UK opened up even earlier to the east europeans, and, correct me if I am wrong, but I did not notice the UK population double in size over the last 10 years.

Did you?

geckonomist writes:

Your "equilibrum" hypothesis is falsified by the facts: When the EU expanded, the old "equilibrium" did not change significantly. Luxemburg was not flooded or devastated with new immigrants until a new "equilibrium" set in.

I guess you are going to talk about dirt poor africans and asians that are fighting to enter in droves.

Before you start, I'd like you to analyse the immigration restrictions that the respective EU countries had towards their colonies.
There were quasi open borders in many many cases until quite recently.
Yet those countries involved did not depopulate and the low-skilled population did not move "en masse" to the colonial masters.

By the way, the people that are most willing to migrate from Africa, are not necessarily the low-skilled people, but certainly the doctors and the lawyers, accountants...

Dewey Munson writes:

No one speaks of impact. First in life is food, shelter and health which are immediate needs.

These are the very facilities under stress here.

How can we contemplate SS cards for a system arguably under the greatest stress.?

Most seem to contemplate an employee employer match which is immediate.

Economic problem of immigration is immense

Steamer writes:


What you do not mention is that there are still labour restrictions placed on Bulgarians and Romanians in most of Western Europe. However, they are bound to expire in a few years (I think in 2014, but am not completely certain). Then we will see the picture. As for the poorest 20% - pretty much half the Romanian gypsies are in Western Europe at the moment working in the shadow economy or commiting petty crimes.
Judging from the fact that for the past 20 years nearly 2 million of my former countrymates (Bulgarians) have emigrated in a situation where there are severe restrictions on immigration, I can assure you that the "flood" will happen.
Mind you, the ratio of Purchasing power between Bulgaria and the UK is probably 1:4. The ratio between Ethiopia and the West is something like 1:20. And this is before the Gini is taken into account.

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