Bryan Caplan  

Sitting on an Ocean of Talent

PRINT
NSA Spying: A Cost/Benefit Ana... Summers believes we can reduce...
Imagine scientists discover a new substance that reverses aging.  They name it Leonium, after Ponce de Leon.  The catch: Leonium is vanishingly rare.  Some years later, though, the scientists discover a trillion dollars worth of Leonium directly under the Empire State Building. 

How would Americans react when they learn they're sitting on an ocean of Leonium?

First, elation.  A trillion dollars of precious Leonium has fallen like manna from heaven - or, to be more precise, risen like manna from the underworld. 

Second, frustration.  At first blush, the only way to get this Leonium is to demolish the Empire State Building, a structure of great economic and cultural value.  The Leonium won't come easy.

Third, ingenuity.  Great minds around the world start brainstorming, desperately trying to figure out a way to gain the Leonium without losing the Empire State Building.  People propose hundreds of ideas - even individuals in no position to personally profit if their ideas prevail.

Fourth, tenacity.  Great minds don't despair if the first hundred Leonium extraction proposals are clearly flawed.  Instead, they keep hunting for alternatives - and sifting through old proposals in search of a glimmer of hope.  Most individual innovators eventually give up, but there's always a new wave of creativity, drawn to the problem by dreams of eternal glory and endless riches. 

During this brainstorming process, a few naysayers fret about the distributional consequences of success: "Only the rich will benefit."  "Only the owners of the Empire State Building will profit."  "Unprecedented longevity will undermine government retirement programs."  "Nursing homes will lose jobs."  But most people scoff at such parochial and misanthropic negativity.  Getting Leonium is a great benefit for mankind, period. 

Now consider: Economists already know how to extract many trillions of dollars of additional value from the global economy.  How?  Open borders.  Under the status quo, most of the world's workers are stuck in unproductive backwaters.  Under free migration, labor would relocate to more productive regions, massively increasing total production.  Standard cost-benefit analysis predicts that global GDP would roughly double.  In a deep sense, we are sitting on an ocean of talent - most of which tragically goes to waste year after year.

When people accept this analysis, though, they rarely display elation, frustration, ingenuity, or tenacity.  The standard reaction, instead, is naysaying.  "First World workers will lose."  "Only the rich will gain."  "They'll all go on welfare."  "Our culture will be destroyed."  "The immigrants will increase crime."  The underlying attitude is not frustration at the difficulty of realizing mankind's full potential, but sheer apathy.  People look for reasons not to open borders - no matter how enormous its potential social benefits.

My point: Apathy in the face of unrealized multi-trillion dollar gains is absurd.  People wouldn't be apathetic if a trillion dollars worth of Leonium were under the Empire State Building.   Instead, people would be constructive - earnestly searching for ways to surmount every impediment to success - natural or social, real or imagined.

I can understand concerns about immigration.  I can understand complaints about immigrants.  What I can't understand is indifference to the mind-boggling potential benefits of immigration.  The knowledge that we're sitting on an ocean of talent should haunt great minds day and night.  They should pace around their offices telling themselves, "There's got to be a way to unlock these wasted trillions of dollars of human potential.  There's just got to be a way."  They should publicly propose and debate solutions, always on the look-out for any idea that "just might work."  Keyhole solutions should be on the lips of every intellectually engaged human being.

A massive pool of humanity trapped in the Third World is no less urgent or engaging than a massive pool of Leonium under the Empire State Building.  So why are people's reactions to the two scenarios so different?  I say anti-foreign bias clouds our judgment.  Psychologically normal humans underestimate the benefits of dealing with foreigners.  On a gut level, they see foreigners as a threat.  So their response to the promise of open borders is "Why bother?" - even though the common sense reaction is "Oh my God - we're sitting on an ocean of talent!"



COMMENTS (47 to date)
MikeP writes:

So why are people's reactions to the two scenarios so different?

It could be because the reaction to the Leonium find is "That could be of great benefit to me" while the reaction even for the enlightened to opening the borders is "That could be of great benefit to others but it's only of very modest benefit to me".

Peter Gerdes writes:

Why do you suppose what people want is absolute economic value. We have every reason, both evolutionary and empirical, to believe that what people desire is relative economic success. This is what one would expect from an evolutionary standpoint as after one meets the minimal demands of subsistence it is relative economic value which determines the number of offspring (for males and quality add indirectly quantity for women through their sons).

Empirically, when given surveys people actually prefer being rich in a poor and unequal society to living in a prosperous highly egalitarian society.

Before you throw this out as absurd ask yourself whether you would rather live in privilege 100 years ago or live in poverty today. Surely if you valued the advancements in health, technology etc... that today's poor have over the richest individuals 100 years ago they are in, absolute terms, better off. I know I certainly would enjoy a life of luxury 100 years ago more than one of poverty today.

So sure opening borders would increase absolute economic value but for those in the first world it is at best irrelevant to their relative economic status and to the extent they appreciate the benefits of relative wealth (cheap foreign travel, cheap labor etc..) it is a lose.

Now for all I have sad here I do believe it is important to resp this absolute gain but people's reaction is neither irrational nor surprising.

Randall Parker writes:

So how about open borders for anyone with an IQ over 130?

The "ocean of talent": A very small fraction of the US population produces the innovations. Most people do not matter in the process of creation of new technologies and sciences.

Unproductive backwaters: Why ever are these places so unproductive? Many of them have very high population densities very conducive to collaboration. Some of them have okay legal systems. So why ever are these places such unproductive backwaters?

spph writes:

Do you think it's moral to skim the cream from countries that desperately need to do their own development? Would you still support the importation of millions of immigrants if it means that tens of millions or more remain mired in poverty for longer than if they stayed to improve their own country?

Mark Bahner writes:
I know I certainly would enjoy a life of luxury 100 years ago more than one of poverty today.

Samuel Clemens (Mark Twain) was a very wealthy man in the late 19th century. Witness his house:

One beautiful house

However:

1) He lost 19-month-old only son to diptheria,

2) His eldest daughter died of spinal meningitis at age 24 (while her family was in Europe, and could not make it back to be with her),

3) His youngest daughter drowned in a bathtub on Christmas eve, likely as a result of an epilepsy attack, and

4) His wife died of heart failure at (only) age 59.

So virtually all of them would probably have lived much longer if they'd lived in the late 20th or early 21st century.

I'd bet if you asked Sam Clemens if he'd trade his house and money for the lives of his family members, he'd do it in a heartbeat.

Ben Hughes writes:

You seem to be expressing wonder at the difference in *reaction*, but more fundamentally most people simply do not see the benefits of immigration. To focus on the "indifference" of the "mind-boggling potential of immigration" merely presupposes which ought to be (fiercely) argued: that there *is* mind-boggling potential of immigration to benefit all.

Brian writes:

There are any number of reasons why opening the borders is not the exciting prospect it seems to you.

"Under free migration, labor would relocate to more productive regions, massively increasing total production."

The vast majority of people wouldn't go anywhere. They value their homes and families and traditions. They wouldn't know what to do with themselves in another country. They wouldn't be able to AFFORD to travel to another country.


"First World workers will lose."..."Our culture will be destroyed."

In the long run open borders will make everyone wealthier and happier. It's a good thing. But like any good thing worth pursuing, it comes with a cost. In the short term, there would be disruption. People would lose jobs. Cultures would be trampled. There are significant downsides, especially if it were done quickly.

The relevant question is how long would the long term be? When would the net benefits arrive? For some, the short term is all they have left. For some, the short term is the prime of their earning years. There is substantial risk involved--it's only rational to want to avoid it unless you are guaranteed to receive the long-term benefit.


"There's got to be a way to unlock these wasted trillions of dollars of human potential."

There is--it's called free trade. I always marvel at your geo-obsession. Potential isn't unleashed because we share the same plot of land. It's unleashed because we engage in exchange. And exchange occurs not by moving people but by moving goods and services. Why can't you see that mining Leonium has NOTHING to do with immigration--it's about connecting everyone through trade, regardless of where they are. Compared with campaigning for open borders, you would do far more good by investing your money in someone's untapped potential.

Is it right to restrict the free movement of people? No, not without a compelling reason. But immigration is not the motherlode you seek. That lies in the freedom of exchange. Any economist should know that.

Andrea writes:
"exchange occurs not by moving people but by moving goods and services."
Actually, it is pretty hard to move services across national borders without moving people. It is often cheaper to pay employees' moving expenses than to rebuild a whole new factory in the target country, if one can even get the requisite permits to build said factory, and it is very hard to get my lawn mowed or my garage built by contractors in another country who are not allowed to cross borders into my country. I vote that we do unlock the mother lode of free trade--by opening up the borders to people.
MikeP writes:

But immigration is not the motherlode you seek. That lies in the freedom of exchange. Any economist should know that.

Actually, "any economist should know that" removing the remaining barriers to free trade offers the world a mere fraction of the global GDP improvement that removing the barriers to free migration offers.

Quoting Lant Pritchett...

At this stage we have more or less eliminated most of the barriers to goods. Quantitative restrictions are almost eliminated around the world. Relative to when I started working as a trade economist in the early 1980s, the world is completely liberalized. So the incremental gains from anything that could happen as a result of WTO negotiations are just infinitesimal. If we did everything, all the remaining goods liberalization, the monetary gains would be between half and two-thirds of the gains from just allowing 3 percent more workers into the OECD. Given the current enormous wage differentials, a minor relaxation of people mobility easily swamps all remaining liberalization on the goods side. There are almost no tariffs left over, say, 20 to 25 percent, and yet wages for unskilled labor differ not by percents but by an order of magnitude—workers in some poor countries make 8 cents an hour, not 8 dollars an hour.

My main point is that we’re giving all this intellectual and political and analytical attention to mopping up that last little bit of trade liberalization. Which is a good thing; I’m all for it—but let’s get our eyes on the next big prize.

MikeP writes:

I actually think the Leonium analogy is unfairly playing on people's desires for immortality, and that effect can't be masked by putting a dollar value on untapped reserves of it.

A better analogy already exists and is in no way hypothetical: newly discovered oilfields worth trillions of dollars. There is even a recent find in Australia that I hadn't heard about until I googled for it.

Do these discoveries of new hard to reach oil induce people from around the world to seek new solutions to extract it? Yes. But do the masses take note of the trillions of dollars of new wealth? No, not particularly -- not beyond an article written for a British newspaper or two. As a matter of fact, people are quite willing to fence off trillions of dollars of oil inside nature preserves and protected continental shelf to avoid the chance of an oil spill where they don't want it.

Why don't people take more interest in all this new wealth? Because an anti-oil bias clouds their judgment? For some, yes. But for most of us it is simply because all that wealth being tapped over decades will merely make the average first worlder marginally better off. Just like open borders being tapped over decades will.

Someone still needs to be concerned about the actually impoverished people of the world, or of the concept of equal rights for all, to actually put that much care and though behind open borders.

Chris Stucchio writes:

Bryan, I want to believe the story you are telling. I'm a global migrant myself, albeit out of the US rather than in. And you have convinced me that on the margin more immigration is good and probably the most important marginal issue today.

But I remain unconvinced by your case for open borders. Immigration today pushes us in decidedly non-libertarian directions - see Tino Sanadaji's posts on the topic, for example.

http://super-economy.blogspot.co.uk/2012/11/what-gop-can-teach-european-right.html

http://super-economy.blogspot.co.uk/2012/11/why-hispanics-are-natural-democrats-and_12.html

And further, when you travel overseas, you observe that the problems many countries have is caused by the people themselves. India is poor because of corruption, nepotism and an absurd focus on the family [1], nationalism and tribalism, and a general cultural lack of freedom.

Once you leave the margin, it becomes far from obvious that importing the third world to the US will do anything but turn the US into the third world, at least in the medium to long run. I believe there is a 30% risk of this. If this is the case, open borders would have an extremely negative effect on future generations.

I believe that if you want to convince more people, you need to address these concerns directly rather than simply glossing over them. I for one would certainly be interested in hearing you address them.


[1] This feeds into corruption, since family is more important than morality, and deprives women of opportunity. To understand how insane it is, recognize that even ardent Indian socialists often like Atlas Shrugged - Reordon's family issues are their issues.

Pajser writes:

There are many aspects of this issue. My opinion is the same as spph's. Open immigration hurts the poorest people in the world. Think what happens to poor people from distant Tanzanian villages when few physicians they can educate migrate to USA.

Jameson writes:

I agree with you on open borders, but I don't know if this post is an example of how to convince someone. Some of the points you make are legitimate (e.g. anti-foreign bias), but I think your analogy is actually pretty flawed.

I'm not even sure about the reaction you imagine would happen in the case of a Leonium discovery. When someone strikes oil somewhere, do most people care? If it's something that's ultimately going to be privately owned, my hunch is that most people shrug their shoulders and go about their lives.

In the case of immigration, however, that is clearly not the case. Immigration affects (potentially) everyone. It has to do with who has the right to share the land over which our government presides. That's a far more public issue than finding a precious resource in a specific location. Or so I would think.

Guest2 writes:

Actually, there is no need to look outside our borders -- we are indeed sitting on an ocean of talent -- underemployed college graduates, one in three to be precise.
http://www.newyorkfed.org/research/current_issues/ci20-1.pdf

David R. Henderson writes:

@Mark Bahner,
Nicely done.

Christopher Chang writes:

If you really believe open borders create that much value, why aren't you prioritizing cooperation with native populations in other countries that are already sympathetic to your ideas? (See this page. The countries at the top of the list may not be particularly wealthy, but some of them do have the stability needed to become wealthy.)

I've repeatedly brought this idea up on openborders.info, and not a single one of the bloggers there have ever seriously followed up on it to my knowledge. (By the principle of revealed preference, this implies that they, at least, are more confident in open borders's ability to transfer value than create it. I trust that your beliefs differ?)

Alex writes:

The public benefit is clearly there but voters care mostly about their private benefit. The real question is what the effect on my personal income would be – I’ll try to put on some hypothetical numbers to show how an average voter may look at the issue, actual studies probably have different results (with a wide error margin).
On the positive side there are cheaper non-traded services (builders, hairdressers, nannies; lower wages abroad are already factored into lower traded goods prices): personal benefit maybe 5-10% for the average consumer. Furthermore there are lower taxes as migrants pay slightly more than they take out, maybe 1%. Finally there are network effects of larger cities/countries but that may be too complex to put a number on in voters’ minds. Let’s call the benefit 8% in aggregate.
On the negative side there’s downward wage pressure: highly variable ranging from 0-20%, average maybe 4% (could be zero in studies but with risk aversion can be justifiably seen as negative). Next there is extra pressure on housing, infrastructure and public services for at least a transition period, which could be counted as a negative 2% (higher rents etc.). This leaves a very small net positive perception of maybe 2%, which is then pushed into the red by irrational fear of the unknown, additional crime and remnants of xenophobia.
Not many people mind 6-figure salary migrants, it's the low-middle education migration that is not perceived as a net private benefit.
What's therefore needed is for the net positive number to be solidly double digit for the average voter but as things stand we’re stuck. A way forward may be found in the competition between Swiss municipalities, where it is of benefit to locals to attract new residents as it drives down everyone’s taxes locally (not nationally – too distant and abstract). By also having accommodating zoning laws there's no pressure on housing while taxes can be meaningfully lower and residents can enjoy cheaper local services in a potentially winning combination.
Singapore is another great case study: public housing remains affordable, residents enjoy cheap labor as consumers and immigration-led network effects have improved the economy at all levels. There's some discontent now that the equation is turning negative for many voters but that's after a very long and successful wave of immigration - if all countries took it as far much of this global benefit could be realized.

george writes:
Bryan: I can understand concerns about immigration. I can understand complaints about immigrants.

Perhaps you can, but I'm not so sure. Every educated partisan--and there are millions on both side of any big issue--thinks they understand the other side perfectly, only they are rational and nice whilst the other side not so much. I bet this bias is worse the more educated you get, because more information leads to more confidence, but rarely changes anyone's priors.

See Parfit's Repugnant Conclusion.

Jonathan writes:

Your comments should give pause for thought to those that make economic objections to immigration but I suspect the underlying reason many are against immigration are non economic.

Here is a good example from the UK for such non economic reasons:

http://libertygb.org.uk/v1/index.php/home/root/news-libertygb/6220-the-non-economic-costs-of-mass-immigration-to-the-uk

Terra writes:

No country believes you've found Leonium. I'd start there. As far as the majority is concerned, you're either the old man who believes he found a leprechaun on a rainbow to deliver him an endless supply of gold, or even worse that you've actually found a mass spreading disease and that you are delusional for wanting to spread it.

There needs to be good heuristics to quickly expose the stupidity of restricting or closing borders. Let's throw out more productive citizens, create barriers to prevent students from wanting to study in another U.S. state, and stop hiring people not born in your state.

NZ writes:

Others have already spoken sufficiently to both sides of the open borders argument, so I'll leave it to them. Instead, I want to talk about whether reversing the aging process truly is "a great benefit for mankind, period."

And to be generous, I'll skip the obvious implications on healthcare and overpopulation.

First of all, I presume Leonium is something you can take for a while, and during that time your physical aging is reversed, and then when you stop taking it you resume aging in the normal direction. Thus by cycling on and off of it your body may remain within, say, a week or two of what resembles the same age for as long as you want before external forces kill you instead. (I say a week or two because that is how long most imbibed substances take to fully filter out of our bodies' systems.) (Presumably, almost nobody would take Leonium continuously without a break, since they would eventually turn into a pre-term fetus and die because they are outside the womb.)

It was left unsaid whether Leonium also reverses the aging of the brain and thus of many aspects of mental development. In the preceding paragraph, I assumed an answer of "No" but now I want to explore the "What If."

So, if the aging on my brain was also reversed by taking Leonium, would I lose things like knowledge, muscle-memory, and self-awareness? If I spent years learning to play the piano and then reversed my age by that same number of years, would I no longer be able to play? If so, then Leonium would certainly NOT be a great benefit for mankind, since it would undo much of the productive capacity of productive people. Even among the unproductive, it would certainly turn many of them into more immature, arrogant, and ignorant people.

And what about reproduction? Our incentive to reproduce comes from the fact that we die. Reproduction is a way to make life continuous for a species even though life is segmented for the individual. If we don't die, we don't have a need to reproduce.

When people become parents, a lot of things change about them: they work harder, they take fewer risks, they become more humble. This is why their insurance rates often go down.

If far fewer people become parents we can expect to see an increase in non-productivity, risk-taking, and rebellious anti-social behavior well into--indeed, throughout--adulthood. And with Leonium, it is an adulthood that need not ever bump into the realities of old age, which normally would apply brakes to much of the aforementioned behavior even if having kids never did the trick.

So, I want to see further justification that Leonium would be "a great benefit for mankind," because right now I'm not buying it. And I need to buy it if I'm to buy the analogy that importing every last productive person from every last corner of the world, no matter the cost, is "a great benefit, period" to me as an American.

WT writes:

A couple of commenters have touched on this, but the problem is that most people aren't being indifferent to untapped wealth, they're being skeptical that such untapped wealth really exists in the first place (given that your evidence for it is almost entirely speculative -- and entirely static rather than dynamic).

After all, if all of these people had such marvelous potential for wealth creation, why aren't they realizing that potential already? If the answer is "bad institutions" or "corruption" or whatever, then the question is why don't we focus on getting rid of bad institutions and letting people realize their potential in their homelands?

It's not as if 7 billion people are going to move to America, or as if America would be remotely the same country if they did. So what you're really talking about is taking a few million of the highest potential people out of Indonesia or Vietnam or wherever, improving their wellbeing but also making it even less likely that their home countries get rid of bad institutions in the future.

It's not clear why that's a net gain for the world.

gwern writes:

It might be helpful to edit the analogy to 'the leonium is strapped to an antimatter bomb whose blast radius may stretch to California' and consider what a more plausible reaction is.

Brian writes:

"Actually, it is pretty hard to move services across national borders without moving people."

Andrea,

First, moving people across borders is not the same as immigration, which implies the capacity for permanent residency and citizenship.

Second, technology is making it easier to transfer services without transferring people. Consider help lines in India. You can even have fast-food workers take orders remotely. The need for on-site service providers can be greatly reduced below what we currently have.

Third, do you really think the average Haitian (to use Bryan's favorite example) can mow your lawn or build your garage better and more cheaply than your neighborhood teenager or handyman? I don't think so. Are you willing to PAY for them to come over and work for you? I don't think so. So immigration policy has little or no effect on your choice of the people who will do the best job for the cheapest price.

RohanV writes:

"Under the status quo, most of the world's workers are stuck in unproductive backwaters. Under free migration, labor would relocate to more productive regions"

Why are these backwaters unproductive?

Is it lack of resources or lack of capital? Is there some natural force that makes these backwaters unproductive? Is it the evil multinationals keeping people in quasi-slavery?

If all these potential immigrants are so amazing, why is their current country so terrible?

I have not seen Caplan give a straight answer to this question, and would really like to see his reasoning.

Brian writes:

"Actually, "any economist should know that" removing the remaining barriers to free trade offers the world a mere fraction of the global GDP improvement that removing the barriers to free migration offers."

Mike P,

You're confusing legal barriers to free trade, which have been greatly reduced, with the capacity of people to participate in the global economy. Until people in 3rd world countries are producing value similar to what 1st world countries produce, we are still far from full participation.

The effect of open borders, which Bryan says would double world GDP, is a drop in the bucket compared with the benefit of having everyone fully integrated in the world economy. You can figure out the advantage for yourself. How much would world GDP increase if all countries were brought up to the average per capita GDP of the top 30 countries, say? Looking at a few stats on per capita GDP at PPP, it looks like the top 30 are roughly 40x the GDP of the lowest 30. Also, average world GDP per capita at PPP is more than a factor of 3 below the average for the top 30, so the effect of fully integrating all people into the global economy is certainly larger than the effect of eliminating border restrictions.

MikeP writes:

Until people in 3rd world countries are producing value similar to what 1st world countries produce, we are still far from full participation.

I await your plan with bated breath.

Psmith in the city writes:

Y'know, people probably WOULD try to look for reasons not to exploit Leontium resources. This seems to be a fairly common complaint among transhumanist types, or was when I followed them--"here we are trying to come up with ways to extend the productive human lifespan, and when we tell people about them they say things like 'gosh, we shouldn't play God' or 'wouldn't immortality get boring after a while?' or etc."


On another note, I'm pretty poor right now, and likely to remain so for the forseeable future...and I would much rather live like this than in luxury c. 1890.

johnleemk writes:

I must confess I'm puzzled at the logic that says "fully integrating all people into the global economy is certainly larger than the effect of eliminating border restrictions."

What sort of integration of all people into the global economy can happen while we still arbitrarily confine most people's economic activity to only within the state they happen to have been born into? Border restrictions by definition exclude people from the global economy. How can I be integrated into the global economy if I'm allowed to send a foreign merchant an email, but I'm not allowed to meet him? How can ordinary business and trade relations take place if I'm allowed to visit a foreign merchant and trade with him, but he's not allowed to recruit me if he likes my work ethic and occupational skills? I can't conceive of a definition of "integration of all people into the global economy" that is consistent with arbitrary border restrictions. Border restrictions meant to safeguard against hostile invasion are one thing. Few trade advocates are clamouring for unrestricted export or import of nuclear weapons or automatic rifles. But the vast majority of people who desire to immigrate, and who sometimes do immigrate unlawfully, clearly do not have hostile intentions. They just want to work. If what you desire is global economic integration, then I don't see how you can justify border restrictions that treat people seeking work as if they are all terrorists or ganglords.

And the notion that trade restrictions are the main barrier to global economic integration is not borne out by any recent study. The literature is remarkably consistent in finding the gains of full labour mobility dwarf the gains of full trade liberalisation by one to two orders of magnitude. See table 1 from Michael Clemens's review of the literature on trade and labour mobility restrictions here: http://openborders.info/double-world-gdp/

MingoV writes:
... most of the world's workers are stuck in unproductive backwaters. Under free migration, labor would relocate to more productive regions... Standard cost-benefit analysis predicts that global GDP would roughly double."

Point one: Most people in well-to-do nations don't care about workers anywhere else.

Point two: GDP is not a measure of quality of life. Most people don't care about GDP in their own nation. They certainly don't care about the GDP of the world.

Point three: Most people are concerned about things that will change their life. People living in a quiet village of 3,000 people would be rather irate after an influx of immigrants pushed the population to 12,000.

Point four: The concerns about social, cultural, and political changes due to open borders are valid. Open borders advocates pretend that this isn't anything to worry about, or that the changes will be for the better. I find that unlikely.

Points one through four are real. The USA will not allow open borders now or for the next few decades.

MingoV writes:
The knowledge that we're sitting on an ocean of talent should haunt great minds day and night. They should pace around their offices telling themselves, "There's got to be a way to unlock these wasted trillions of dollars of human potential.
Instead of trying to influence high productivity nations to double their populations with poor immigrants, you Open Borders advocates should address the root cause of most hypo-productivity: kleptocratic governments. Convince the UN to form a real army that overthrows such governments, and then establish governments that support capitalism and free markets. This will maximize human productivity and reduce mean population density.
Christopher Chang writes:

"What sort of integration of all people into the global economy can happen while we still arbitrarily confine most people's economic activity to only within the state they happen to have been born into? Border restrictions by definition exclude people from the global economy. How can I be integrated into the global economy if I'm allowed to send a foreign merchant an email, but I'm not allowed to meet him? How can ordinary business and trade relations take place if I'm allowed to visit a foreign merchant and trade with him, but he's not allowed to recruit me if he likes my work ethic and occupational skills? I can't conceive of a definition of 'integration of all people into the global economy' that is consistent with arbitrary border restrictions."

So why have you and all of your colleagues been so uninterested in working with the countries which ALREADY are largely willing to open their borders? Why don't you care to build up high-quality institutions in those countries which are especially robust in the face of high immigration, and make them desirable destinations for increasing numbers of migrants?

Making an obvious analogy to open and closed source software, while one castigates Apple for their closed practices, one should simultaneously provide a real-world demonstration of their alternative. (Note that asserting that the past already proves your point has practically no power to convince the majority on the other side, since they evaluate the past differently than you do; but showing that you can effectively meet their current needs does have power. Also note that I consider Richard Stallman to be a genuine hero, even though I don't always agree with him, because with GNU he *did* provide a real-world demonstration that I use almost every day.)

Lant Pritchett writes:

I obviously like the basic thrust of this. But it raises the obvious tensions about anything about immigration. Forget Bryan said anything about "open borders"--which is admittedly a huge, non-marginal change--and just talked about relaxing the existing restrictions on immigration (which in every rich country as a set of highly binding quantitative restrictions). I think this would make his point even more clearly which is that at the margin the gains from the relaxation of these constraints is huge so why are not people concocting ways to do this?

This is especially on point for people doing "development" (either economics or practice) as the gains from even large and beneficial programs are dwarfed by tiny gains in additional labor mobility. Just as a for instance, I have done the (crude) calculation that the total annual gains from the Grameen Bank (estimated in the most generous possible way) is the equivalent of just 3500 additional Bangladeshi migrants to an OECD country (which is truly marginal in any labor market). But if one compares the time, energy, intensity, attention that has gone into micro credit versus that devoted to relaxing migration barriers it is orders of magnitude larger for micro-credit.

Another example. A friend of mine talked to a development agency official managing a 800 million dollar a year development portfolio about devoting some resources to encourage more migration of Haitians in a development friendly way. The response was that they wanted zero, exactly zero, of their development budget devoted to migration--in spite of the obvious fact that just remittances from migration were a much larger "sector" of the Haitian economy than anything else the development portfolio was promoting. Again, at the margin why are development agencies not thinking about ways to promote the gains from labor mobility at the margin (even if one forgets about "open borders").

And, his point is very strong, and, perhaps paradoxically made stronger by most of the objections raised in the comments, in that, suppose we take the objections are real--why are people not working hard every day on how to design real world instruments that realize the available gains while addressing the real economic, political and social objections raised in the comments?

Lant Pritchett writes:

One point that comes up in the comments is that "if these people were so productive" as if this is a debatable empirical proposition.

On this point we can compare wages of people in the USA and "observationally equivalent" people (e.g. same gender, years of schooling, place of birth, etc) in the "home" country (e.g. El Salvador, India, etc.). There is no real debatable question that when people move from a poor country to a rich country their wages increase to roughly the rich country level (controlling for characteristics). Since these are wages paid by willing employers that these do not reflect something roughly like their productivity is a difficult argument to sustain.

So this is not a hypothetical or something we economists do not scientifically know. That people are dramatically (factor multiples to orders of magnitude) more productive in some countries than others is something we empirically know as a fact.

Steven Flaeck writes:

The linked paper doesn't seem to really support the claim. It argues for more robust research and the headline statistic here seems to rely on a >73% emigration rate out of the third world. So, if you think that the US and EU are going to absorb 3.65 billion people, I have to wonder how you think that's supposed to work, given that you're approximately quadrupling real estate and infrastructure demand. One could easily imagine that this would rapidly brake emigration long in advance of hitting the 73% mark.

By contrast, it's perfectly plausible that we'd simply deconstruct then rebuilt the Empire State Building out of the Leonium Extraction fund. It's not like we haven't moved immense, culturally significant works before so we can tap some resource.

johnleemk writes:
So why have you and all of your colleagues been so uninterested in working with the countries which ALREADY are largely willing to open their borders? Why don't you care to build up high-quality institutions in those countries which are especially robust in the face of high immigration, and make them desirable destinations for increasing numbers of migrants?
How to develop the economies of poor countries is very poorly understood, compared to the question of how to develop the capabilities of people who happen to have been born into poor countries -- it's quite well understood that in general, those capabilities can easily be developed should those people be allowed to migrate.

Also, a few things to consider:

* Most of the current Open Borders bloggers are either American citizens or American residents. For obvious reasons, citizens are interested in swaying the policies of the government that represents them. Also, per Hayek, most OB bloggers have adequate local knowledge of how to work with and influence institutions in the countries we're familiar with and have ties to. We would not have the social capital or local knowledge to attempt to implement an open borders policy in, say, Vietnam. FWIW, as a Malaysian citizen, I fully support open borders for my country, and despite my country's inhumane treatment of asylum seekers, am glad that my country has, in many respects, more open borders than the US.

* It seems at first glance intuitive that it would be easier to liberalise migration in countries (and by "easier" I don't just mean politically, I also mean "easier to implement keyhole solutions to address targeted harms from greater migration") with robust institutions than it would be to build robust institutions in institution-poor countries. Is there a particular reason you're so eager to dismiss any room to liberalise immigration policies in the developed world as impossible or completely unfeasible, beyond the precautionary principle?

* The scope of the Open Borders blog is explicitly global, and especially relative to Bryan's posts on EconLog, has a much less US-centric focus. Many of our bloggers -- myself, Hansjoerg Walther, Paul Crider, Victoria Ferauge -- either have non-US backgrounds, reside outside the US, or both, and have written plenty about open borders and migration issues outside the US.

I am happy to provide a real world demonstration of the potential of open borders. As a citizen of Malaysia and a resident of the US, however, I have the local knowledge and social capital to better push for liberal migration policies in these particular polities. I'm very interested in open borders everywhere else as well -- but I don't have the local knowledge to even begin implementing open borders in, say, Vietnam, and there's no obvious reason why I would want to make an extremely intensive investment in acquiring that local knowledge when I have strong ties to two countries with a history of liberal immigration policies and who are, in so many ways, literally nations of immigrants.

Christopher Chang writes:

"How to develop the economies of poor countries is very poorly understood, compared to the question of how to develop the capabilities of people who happen to have been born into poor countries -- it's quite well understood that in general, those capabilities can easily be developed should those people be allowed to migrate."

If economic development is so poorly understood, how did so many East Asian countries succeed in such similar ways? China copied many ideas from Singapore, Hong Kong, and Taiwan. Vietnam can and is copying from that playbook as well, and Rwanda's leader has explicitly stated his goal of adapting Singapore's model to Africa. Conditional on no disastrous leadership change, would you bet against either Vietnam or Rwanda? And that's two of the three countries with the most open borders-friendly natives.

(I will grant that Rwanda appears to be vulnerable to a disastrous leadership change. But the popular consensus seems to be that Vietnam will be fine as long as it avoids actively screwing up.)

"It seems at first glance intuitive that it would be easier to liberalise migration in countries (and by 'easier' I don't just mean politically, I also mean 'easier to implement keyhole solutions to address targeted harms from greater migration') with robust institutions than it would be to build robust institutions in institution-poor countries. Is there a particular reason you're so eager to dismiss any room to liberalise immigration policies in the developed world as impossible or completely unfeasible, beyond the precautionary principle?"

I am not categorically opposed to more liberal immigration policies in the "developed world". Singapore is one of the most developed countries on the planet, and I continue to wish it the best of luck in making liberal entry rules work, since its government has generally earned the trust of its people. (Note that it still has considerable debugging to do.)

What I am opposed to is government betrayal of the natives. US public opposition to increased low-skill immigration has been something like 70% for decades, despite constant media propaganda favoring your side. Bryan recently debated in front of a friendly audience and was utterly destroyed. (Even the most favorable interpretation of that result--it was an anomaly driven by a misleading initial prompt, Wadhwa's "betrayal", and cheap tactics by Unz--does not really leave room for Caplan's arguments having power to make a dent in the 70%-30% gap.) There is no way to ethically change US policy in the direction you want in the near future. And the people who are seriously trying to implement such a change in the near future do not care about minimizing long-term harm to natives, via e.g. paring down the welfare state which Milton Friedman famously said was incompatible with free immigration.

There is another major advantage to focusing on places like Vietnam (or in your specific case, perhaps Malaysia). You have an opportunity to influence the development of systems which are intrinsically robust to immigration. If you want to actually realize something like "double world GDP" instead of simply watching it used as one of many interchangeable slogans justifying the latest political screwing over of group A by group B, such systems need to be (re)developed.

(If you want to argue that the US used to have such systems, I'd agree. But the politicians pushing for more low-skill immigration are also the ones *least* interested in turning back the clock on that dimension. Cooperation with them is flat-out immoral.)

Brian writes:

"I can't conceive of a definition of "integration of all people into the global economy" that is consistent with arbitrary border restrictions. "

johnleemk,

You need to expand your imagination then. Integration into any economy, local or global, means being fully active as a trading partner with many other entities. It menas that most of the economic value you create comes from acts of mutually beneficial trade and not from things you do for yourself. Since trade involves the geographic exchange of goods and services, not the movement of the people doing the trading, it should be clear that immigration plays no essential role.

As an obvious example, I don't need to live near you or Bryan or any other poster here to exchange ideas freely and to great effect. Indeed, if we DID live near each other, it would provide no marginal benefit to what we can already accomplish. Technology has made and will continue to make distance no barrier at all to free trade, lessening the economic value of immigration.

To put it another way, the vast majority of Americans are fully integrated into both the national and global economy, even though many never leave their states for business purposes and fewer still ever leave the country. But this can be true for all people everywhere, making immigration less valuable economically than it seems.

Brian writes:

"I await your plan with bated breath."

MikeP,

No need. The global market is doing a great job all on its own. We are on pace to eliminate $1/day poverty from the world in the next 30 years. Africa, which always seems to be behind, is a rising economic giant. Invest there and let the market do its thing. Not only will you get rich, but you'll be doing a great act of charity.

Again, please don't get me wrong. I personally favor much more open borders. But there's much more to be gained by economic development in the countries that currently lag than by encouraging massive immigration.

Jagdish Kadvekar writes:

A strange metaphor from a libertarian since Mr. Caplan apparently casts aside, in all the leonium extraction discussion, the OWNERS of the Empire State Building.

They own the building, they own the land on which it stands. It's their leonium. If they want to demolish the building, they can do so (takng care they do not demlish neighbouring buildings). If they are happy with the building, again, it's for them and only them to decide. No proposal coming from someone else is relevant.

Very strange argument from Mr. Caplan. How does a libertarian forget that each thing in this world has a rightful proprietor (certainly in the idealized libertarian society). The metaphor fails, in my opinion, and so do the general arguments for open borders.

Ken P writes:
Guest2 writes:

Actually, there is no need to look outside our borders -- we are indeed sitting on an ocean of talent -- underemployed college graduates, one in three to be precise.
http://www.newyorkfed.org/research/current_issues/ci20-1.pdf

I would question whether a college degree = talent.

There are a lot of high paying jobs in North Dakota and other areas of the country. Moving to where the jobs are is a trait immigrants are pre-selected for.

Mark Bahner writes:
Convince the UN to form a real army that overthrows such governments, and then establish governments that support capitalism and free markets.

The UN is in favor of capitalism and free markets? Who knew!

P.S. This isn't really a joke. Look at what the U.S. government under G.W. Bush did in Iraq. Wouldn't you say that the U.S. under the G.W. Bush administration was at least as strong an advocate for capitalism and free markets as the U.N.? But has Iraq turned into a great location for capitalism and free markets?

James A. Donald writes:

Your arguments assume that opponents of open borders agree that open borders would give them a free lunch.

I don't think it will give us a free lunch. I think it will lead to the murder of my children and grandchildren.

Open borders will very soon make whites a market dominant minority. By and large, most of the time, in most of the world, sooner or later, market dominant minorities get ethnically cleansed or outright genocided. Not everywhere, but that is the way to bet.

[broken url removed. Please check your links while Previewing your comments.--Econlib Ed.]

Olivia writes:

What about what our country stands for? We grow up here and barely have a handle on the liberty that our country stands for. Our country is struggling right now to uphold human liberty. If we allow more people into the country that don't understand this, are they going to uphold this liberty, or further vote to have more centralized government control? Just a thought. I know that when people become citizens they need to take a civil test that probably addresses this, but I am not seeing the immigrants upholding this value based on their voting record. Any thoughts?

99guspuppet writes:

Bryan Caplan .... This an excellent article. I adore your point of view. The comments are very instructive as well. No wonder I want to hide in my bed...... some people are so selfish they will screw themselves to make sure no one else is doing better than them. Bummer Gus in Denver

MikeP writes:

Two thoughts:

1. People who choose to move to the US may well have a better handle on liberty than those born into it. This becomes even more the case if the US takes stances that explicitly promote liberty, such as recognizing the natural rights of economic migrants.

2. Beware the destroying of liberty in order to save it. The police state practices required to strictly enforce restrictive immigration law are very unAmerican.

Thiago Ribeiro writes:

"Empirically, when given surveys people actually prefer being rich in a poor and unequal society to living in a prosperous highly egalitarian society."
How many Americans and West Europeans would want to keep earning their current wages in exchange for living and working in (relative)luxury in an African Kleptocracy?

Comments for this entry have been closed
Return to top