Monday, July 10

So basically, immigration is good

The NYTimes magazine pretends economists disagree about immigration: the teaser says,"Politicians aren't the only ones fighting over the answers." But the article concludes by putting the argument in this light:
Economists more in the mainstream generally agree that the U.S. should take in more skilled immigrants; it's the issue of the unskilled that is tricky. Many say that unskilled labor is needed and that the U.S. could better help its native unskilled by other means (like raising the minimum wage or expanding job training) than by building a wall. None believe, however, that the U.S. can get by with no limits. Richard B. Freeman of Harvard floated the idea that the U.S. simply sell visas at a reasonable price. The fee could be adjusted according to indicators like the unemployment rate. It is unlikely that Congress will go for anything so cute, and the economists' specific prescriptions may be beside the point. As they acknowledge, immigration policy responds to a host of factors — cultural, political and social as well as economic. Migrant workers, sometimes just by crowding an uncustomary allotment of people into a single dwelling, bring a bit of disorder to our civic life; such concerns, though beyond the economists' range, are properly part of the debate.

What the economists can do is frame a subset of the important issues. They remind us, first, that the legislated goal of U.S. policy is curiously disconnected from economics. Indeed, the flow of illegals is the market's signal that the current legal limits are too low. Immigrants do help the economy; they are fuel for growth cities like Las Vegas and a salve to older cities that have suffered native flight. [George] Borjas's research strongly suggests that native unskilled workers pay a price: in wages, in their ability to find inviting areas to migrate to and perhaps in employment. But the price is probably a small one.

The disconnect between Borjas's results and [David] Card's hints that there is an alchemy that occurs when immigrants land ashore; the economy's potential for absorbing and also adapting is mysterious but powerful. Like any form of economic change, immigration causes distress and disruption to some. But America has always thrived on dynamic transformations that produce winners as well as losers. Such transformations stimulate growth. Other societies (like those in Europe) have opted for more controls, on immigration and on labor markets generally. They have more stability and more equality, but less growth and fewer jobs.

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