Tag Archives: double world GDP

How Would a Billion Immigrants Change the American Polity?

August 14, 2015 Nathan Smith 41 Comments

[UPDATE: See the follow-up blog post A Billion Immigrants: Continuing the Conversation by Nathan Smith, where he responds to comments on and criticisms of this blog post. You may also be interested in the Open Borders Action Group discussion of this post, where Smith articulates some aspects of his views in more detail, and others offer criticism.]

A couple of years ago, I wrote a post called “The American Polity Can Endure and Flourish Under Open Borders.” I would not write that post today. The American polity might endure and flourish under open borders, but I wouldn’t claim that confidently. What changed my mind? A greater familiarity with the theoretical models that are the basis for “double world GDP” as a claim about the global economic impact of open borders, especially my own. It turns out that these estimates depend on billions of people migrating internationally under open borders. Previously, my vague and tentative expectations about how much migration would occur under open borders were akin to Gallup poll estimates suggesting that 150 million or so would like to migrate to the USA. Others may disagree, but I was fairly confident at the time that the US polity was robust enough to absorb 150-200 million immigrants (over, say, a couple of decades) and retain its basic political character and structure. I do not think the US polity is robust enough to absorb 1 billion immigrants (even, say, over the course of fifty years) and retain its basic political character and structure.

For more educated guesswork about the number of migrants under open borders, see also our reference article on swamping; Joel Newman’s article “If Open Borders are Instituted Gradually, What Should be the Initial Number of Immigrants Admitted?”, which, among other things, details how the threat of swamping gives open borders advocates like Joseph Carens and Michael Huemer pause, as well as Joel Newman’s latest post; and Vipul Naik’s explorations of whether the case for open borders can be combined with radical agnosticism about how many would migrate and whether the number of migrants under open borders would be “too high” or “too low” (e.g., by utilitarian-universalist criteria). In this post, I’ll argue that swamping probably will happen, and that open borders is the right thing to do anyway.

To the question of what kind of polity and society the US would become with a billion immigrants, I have only the vaguest and most speculative notions, but for this post to make sense at all, I’ll have to outline my guesses as best I can. I’m focusing on the US case because I’m most familiar with US institutions and they’re most well-known, but I’d expect other Western countries to have similar experiences. As an aid to intuition, think of the way Roman and British institutions evolved when they came to govern far more people (albeit due to territorial expansion rather than immigration). In both cases, the polity in question survived in the sense that a continuous thread of sovereign authority was maintained. But the character of the polity was transformed.

In the Roman case, the participatory institutions of the Republic gradually broke down. The family farmer, backbone of the old Republic, was crowded out by latifundia, large farms worked by slaves. The Roman populace was largely turned to a mob dependent on public handouts. Finally, the Republic gave way to a permanent dictatorship by the emperors, which, though the loss of the Republic was felt keenly by Rome’s aristocratic intellectuals, was not all bad. Historian Edward Gibbon, writing in the 18th century, celebrated the reigns of the “five good emperors” Nerva, Trajan, Hadrian, Antoninus Pius and Marcus Aurelius (2nd century AD) as the happiest time in the history of mankind. The Senate still met, and Romans still called their state the “Republic,” but the real constitution had changed.

The British case is quite different in that the acquisition of a globe-girdling empire “on which the sun never set” didn’t influence the governance of the UK all that much. In four centuries of British empire, from the settlements at Jamestown and the Caribbean sugar islands to the relinquishing of Hong Kong, the British home constitution certainly underwent profound transformations, towards liberalism (the change took place from about 1750 to 1850), democracy (from about 1830 to 1910) and socialism (from the Liberal/Labor victory of 1906 to the election of Margaret Thatcher in 1979), but these had far more to do with the influence of Enlightenment ideas and the Industrial Revolution, than with the empire. The empire, meanwhile, was never governed by the same liberal-democratic principles that prevailed in Britain. It was governed in a manner at once authoritarian and improvisational. Since London was so far away and could rarely understand local circumstances and difficulties, it tended to ratify what the “man on the spot” had done. Often, in effect, public power passed into private hands, as when the East India Company ended up governing India. Often, too, the British Empire was conservative, in the sense that British officialdom tried to co-opt and collaborate with local, traditional institutions. At the same time, a kind of ideology developed, according to which it was the British imperial mission to gradually foster liberal, democratic, representative institutions– not Christianity, interestingly: imperial institutions weren’t particularly friendly to missionary efforts– among the empire’s subject peoples. British political thought provided the templates for both the conservative (Edmund Burke; Winston Churchill) and the liberalizing (Locke; Adam Smith; J.S. Mill) strands in British imperial governance.

I would tentatively envision the US experience under open borders as resembling the British and Roman cases, inasmuch as the protocols and ideals of the US polity, as well as its merely ethnic characteristics, would persist in attenuated form, but governing a much larger population would necessitate improvisational and sometimes authoritarian expedients that would cumulatively transform the polity into something quite different, even as it claimed descent from the historic constitutional polity of the United States as we know it. The illusion of continuity would deceive the subjects of the new polity, native-born and immigrant, to a considerable extent, though on the other hand there would be a good deal of lamentation and triumphalism, and only after several generations would historians be able to look back and assess the bewildering transformation in a sober, balanced way.

Certain American ideals would die of their own increasing impracticality, e.g., “equality of opportunity,” the social safety net, one person, one vote, or non-discrimination in employment. Americans might continue to feel that these ideals were right long after they had ceased to be practiced, as the Romans seemed to feel that Rome ought to be governed by its Senate long after real governance had passed to the emperors. I don’t see how public schools could adapt to a far larger and more diverse student body. I think there would have to be a transition to some sort of vouchers combined with individual and/or community responsibility for education, e.g., the government pressures the Chinese neighborhoods to set up Chinese schools. Jefferson’s cry that “all men are created equal,” which today is sometimes mistaken, almost, for an enforceable policy rule, would retreat until wasn’t even an aspiration, but only a dream. Of course, open borders would actually mitigate global inequality, but American egalitarianism is a sheltered creed that needs the border as blindfold to retain its limited plausibility as an ideal.

If open borders included open voting, US political institutions would be overhauled very quickly as political parties reinvented themselves to appeal to the vast immigrant masses, but I’ll assume the vote would be extended gradually so that native-born Americans (including many second-generation immigrants) would always comprise a majority of the electorate. This would put an end to majority rule, for a large fraction, likely a majority, of the resident population would lack votes. As it did in the British empire, minority governance would clash with democratic ideas to undermine the legitimacy of the regime, though not, I think, fatally. This could be a benefit, in that defenders of the regime would need to appeal, as Edmund Burke once did, more to the regime’s performance in fostering prosperity and adhering to objective norms of justice, than to crude majoritarian math (which in any case has long since been exposed as logically incoherent). The Republican and Democratic parties would be likely to maintain their duopoly, but their ideologies would go through a continual metamorphosis, not only to appeal to new immigrant voters, but perhaps even more, to adapt to the realigned interests of the natives, who would derive their incomes more from land, shareholding, and government subsidies, and less from wages.

Spontaneous Schelling segregation, even if not enforced by, or even if actively opposed by, the law (but I doubt the law would resist for long), would make neighborhoods and workplaces, and a fortiori churches and community organizations, far more homogeneous than the resident population as a whole. I have advocated legalizing and de-stigmatizing private discrimination against immigrants, but even if it remained illegal, I think private discrimination would be widely practiced, simply because statistical discrimination is efficient, and in the more complex and dynamic economy of an open-borders America those efficiencies would be more worth capturing than ever. Many natives would retreat into gated communities, not so much from fear of crime as simply from love of the familiar. There would be large immigrant neighborhoods dominated by particular ethnicities, where English was rarely spoken, yet English in the US would remain a lingua franca for all the immigrant groups and wouldn’t be threatened as the national language (though German in Germany, Dutch in the Netherlands, etc., might). Overall crime rates might or might not rise, but law enforcement would often be baffled by new and complex challenges. The overworked and puzzled courts would have to improvise and compromise and decline a lot of cases, and would end up leaving a lot of stuff in an emerging domain of private law. I’d expect gaps to emerge where representatives of the official courts feared to tread and a kind of anarcho-capitalist natural law would prevail, and these might be the most productive, innovative, prosperous places in the new, open-borders America. As in the Dark Ages, the Christian churches would likely be more effective than the government in reaching out to, serving, and cultivating a sense of community and identity in many immigrant populations. As in ancient Rome, native-born Americans would find themselves increasingly unable to govern a larger and more diverse subject population through traditional institutions of self-government– they might often find it expedient, as the British empire did, to let public power slip into private hands– but on the other hand, they could easily vote themselves increasing handouts from a burgeoning treasury.

There would probably be an increasing role for private security companies, both to supply protection to private firms that didn’t trust the police to handle the strange new situation, and as contractors for the government. I don’t think it would be too difficult for a regime claiming descent from the US Constitution to fend off open contestation of its sovereignty. Still, if you remember America’s national reaction to 9/11, it isn’t difficult to imagine that even intermittent, local stirrings of revolt would transform the American psyche enough to make weapons training in schools or even universal conscription into some sort of national police force attractive, in order to empower the citizenry physically to defend its sovereignty against a possible immigrant revolution. The vote and citizenship would likely be bestowed opportunistically on immigrant groups deemed especially loyal or effective, both for national security reasons, and for partisan advantage when Republicans or Democrats found themselves favored by some immigrant group.

The least tentative part of my forecast is that all this would take place amidst a continuous surge of booming economic growth, with fortunes being made galore, but this might take forms that some would find disturbing. We would see some modern latifundia, worked not by slaves this time but by voluntary immigrants, but working for pay rates that would strike native-born Americans as a form of slave labor. Meanwhile, we would likely see modern equivalents of the ancient Roman mob, privileged idlers demanding bread and circuses paid for by taxes collected from non-citizens. Entrepreneurs would thrive with so many new workers and customers. The Dow would rise, and rise, and rise. Landowners would see their assets appreciate rapidly and would face a bewildering variety of opportunities to put them to profitable use. Educators and medical personnel would enjoy an almost limitless demand for their services. Of today’s middle-class Americans, even many who failed to find ultra-productive niches in the new open-borders economy would find domestic servants suddenly affordable. The cruel dilemma now faced by educated women, career vs. children, would be greatly mitigated as live-in nannies would become abundant and cheap. American seniors, too, would flourish as the quantity and quality of eldercare workers rose sharply, and paid drivers became affordable to anyone with a little income over and above their Social Security check. But while two-income professional couples would find their domestic arrangements greatly eased, employment rates among native-born Americans would probably fall significantly, partly because lower wages for unskilled labor would make working too unremunerative to bother with for those without special skills, partly because many Americans would be able to live rather comfortably on dividends, land rentals, and government subsidies. For some, this comfortable rentier lifestyle would rankle, clashing as it does with Americans’ traditional disdain of parasitic aristocracies. People need to feel like they have a function. But some sort of general conscription into a national police force might help here. Americans cognitively or culturally ill-equipped to thrive in the dynamic new open-borders economy would be useful to their fellow citizens, and would justify the increasingly valuable privileges and subsidies to which citizenship entitled them, by serving as a kind of praetorian guard.

In short, I think the most wild-eyed predictions of the open borders optimists will come true, and to spare, but I think a lot of the forebodings of the grimmest open border pessimists will also prove more than justified.

All these forecasts are so tentative that I’m embarrassed to write them down at all, but they are necessary to help readers to understand what I mean when I doubt that the American polity can endure and flourish under open borders. It’s not that I’d expect a complete civilizational collapse, or a revolution. On the contrary, I’d expect superficial continuity. But an open-borders America of a billion people would, in substance, be as different a polity from the polity that the United States of America is today, as the Roman Empire of the 2nd century AD was from the Roman Republic of the 3rd century BC. At the end of this post, I’ll write a bit about whether the end of the American polity as we know it should be regretted or welcomed. But first, would billions really migrate under open borders?

It may seem foolish of me to have so much altered my view of what an open-borders future would look like, in response to a few mere economic models. To be sure, I certainly don’t believe that these models are anything like exact descriptions of an open borders future. The authors, including myself, make all sorts of simplifications, some of them obviously unrealistic, to create a platform from which to launch heroic feats of extrapolation. The wisest course, which Paul Collier for example seems to adopt, may seem to be to dismiss the guesses as unrealistic. But my former guesses had, and any other guesses I could now formulate without reference to the models would have, even less basis. I believe the economic models of open borders, flawed and fallible as they are, represent the most rational estimates available of how many would migrate under open borders. I’ll try to anticipate and reply to a few objections in order to consolidate this point.

1. What about the Gallup polls? That’s easy. Gallup can’t take diaspora dynamics (also see Bryan Caplan and Paul Collier on this) into account. It can only find out how many people would now like to emigrate. But under open borders, after a little while, many people would be more willing to emigrate because there would be large communities of their fellow nationals abroad, including some of their loved ones.

2. What about Europe? Contemporary Europe stands as an apparent counter-example to claims that open borders would trigger an epic transformation of human geography. The European Union is said to have internal open borders, and though a glance at the relevant European Commission webpage suggests that EU citizens’ rights to live and work elsewhere in the EU are subject to some red tape, it surely comes close. And while this has led to many millions of internal EU migrants, the migrant share is an order of magnitude less than what the global economic models of open borders predict. I think there are several reasons for this. First, GDP per capita doesn’t vary that much within Europe, which not only mitigates the pressure to migrate but may prevent diaspora dynamics from achieving critical mass. Second, EU countries are among the world’s oldest, with most having a median age above 40, whereas young people are more inclined to migrate. Third, far more than any other region of the world, Europe has been carved into national homelands through centuries of cultural genius and military jostling, so that local ties are probably more important there than elsewhere. Fourth, EU “cohesion” policies deliberately subsidize the poorest European regions, mitigating pressure to migrate. Fifth, migration within the EU seems to be accelerating as a result of the economic crisis that began in 2008, so slow migration may turn out to have been a temporary anomaly. Puerto Rico, which has enjoyed open borders with the USA for a century, has experienced so much emigration that most (about 60%) people of Puerto Rican descent live on the US mainland, even though Puerto Rico isn’t all that poor, with a GDP about half that of the USA as a whole. Puerto Rico’s experience, or that of 19th-century Ireland, may be more predictive of an open borders future than contemporary Europe is. In that case, many billions would migrate, and the global economic models of open borders are getting the order of magnitude right.

3. It’s never happened before. Even in the 19th century golden age of open borders, the share of migrants in world population was well below 10 percent. Before and since, it’s been lower. And now we’re predicting a rise in the share of international migrants to around 50 percent of world population! But of course, just because it’s never happened before doesn’t mean it won’t. The Roman Empire and its fall, the medieval cathedrals, the circumnavigation of the world, and the Industrial Revolution hadn’t happened till they happened.

4. People are loyal to their homelands. Another reason for skepticism is that the models apparently leave out of account that people feel affection and love for their homelands, while foreign countries are scary and forbidding. That’s why international migration has always been something “exceptional people” do. But first, the models don’t actually leave this completely out of account. My estimates of global migration under open borders, for example, assume that everyone stays put unless (relative to the status quo) migration offers higher pay for raw labor and/or human capital. No one would emigrate from the USA, since both raw labor and human capital would be attracted to the USA. Yet a recent poll suggests that 1 in 3 Americans would like to emigrate if they could. Few can have a strong economic motive to do so, since the USA is one of the richest countries on Earth, so either weak economic motives suffice (do they want to earn Australia’s minimum wage? to enjoy the Swedish social safety net?) or else cultural preferences (the fun loving culture of Brazil? the ancient dignity of Japan? the beauty and charm of western European cities?) actually motivate them to leave rather than to stay. I agree that people’s attachment to their homelands, along with simple inertia, would probably keep migration down to hundreds of millions in the short run, but in the long run, e.g., over the course of a few decades, I think diaspora dynamics would overwhelm local ties. Also, the globalization of culture (see me and Bryan Caplan) has made migration (especially to the US, the chief source of the globalizing culture) much easier, and will continue to make it easier in future. (Language is one of the more quantifiable elements of this trend. This site estimates that there are almost 1 billion. The British Council expects two billion English speakers by 2020. Of course, you can also immigrate first and learn English later, or immigrate into a diaspora bubble and never learn English.)

5. Killing the goose that lays the golden eggs. Wouldn’t epic mass migrations be self-halting, because the desirable properties that make wealthy countries such attractive immigration destinations would be erased by mass migration? Don’t the economic models ignore this? Actually, no. In particular, my model allows for some total factor productivity (TFP) reduction in destination countries. Even if epic mass migrations degraded institutions (or whatever causes TFP) in rich countries, they’d still be attractive to billions.

6. Backlash. Paul Collier, in Exodus, contemptuously dismisses the economic models of open borders, but hardly pretends to give any reason why. To the extent that his implicit reason for dismissing them can be deduced from the book, it’s that he thinks there would be a huge nativist backlash. More recently, Ryan Cooper at The Week argued that “a massive wave of immigration is not a magic fix for the economy” because “air-dropping a billion random foreigners into the country would do, of course, is create the mother of all nativist backlashes.” But this begs the question. It’s certainly unlikely that open borders will be adopted by any country anytime soon, but the question is what would happen if it were.

My new doubts that the American polity could survive and flourish under open borders do not in the least undermine my support for open borders. For one thing, the American polity is too small a thing to have much weight in these scales, when the well-being of so many billions is at stake. But my estimation of the value of the American polity as an institution has also dwindled considerably of late. Daron Acemoglu’s thesis in Why Nations Fail, basically that the prosperity of the West depends mainly on its representative and democratic institutions, has quite a few adherents in contemporary development economics, but I attach little credence to it. I was actually surprised, in the data exercise undergirding my open borders forecasts, by how much of the wealth and poverty of nations seems explicable by human capital, broadly understood, so I’ve downgraded “institutions” (and “total factor productivity”) as explanatory factors in the wealth and poverty of nations. Even to the extent that institutions are important, I think democracy is less important than things like the thousand-year-old British common-law tradition, or norms of religious freedom and free speech, that predate and are quite separable from democracy. I don’t think the US polity, as it was founded in 1789, is or ever was the chief explanation of the enviable economic prosperity that the US has enjoyed throughout its history. But I do attach some value to what that polity was historically.

In particular, I see the US Constitution of 1789 as one of the wisest systems of government ever devised, albeit seriously marred by its tolerance for slavery. There followed almost 80 years of what may be called “Tocqueville’s America,” a time when a Jeffersonian political philosophy was in the ascendant, government was mostly small and local and highly participatory, and the way the Constitution was implemented in practice was reasonably conformable to its intended meaning. Then came the Civil War, which erased slavery, a magnificent achievement, while at the same time replacing the loose social contract among states with a powerful federal government from which there was no right of secession. Nonetheless, for a few more decades, the US still enjoyed a genuinely limited government, wherein elected officials really felt that the Constitution endowed them with limited powers, and they simply had no right to do more than it had authorized them to do. This limited, constitutional government was lost forever in the 1930s, when Roosevelt bullied the Supreme Court into elastic interpretations of the Constitution, especially the commerce clause, that rendered obsolete the enumerated powers strategy for restraining the federal government on which the founders had principally relied. From the 1930s onward, the federal government was still somewhat constrained by the Bill of Rights, but other than that, a kind of absolutist democracy was born, where elected majorities could do anything they liked, very high tax rates produced a substantial economic leveling of the population, and conscription fostered a sense of shared citizenship and made foreign policy much more participatory than it has been before or since. Meanwhile, the most distinctive and important feature of the American polity, religious freedom, traced its origins back before the 1789 Constitution to the original pious motives of the Puritans who settled Massachusetts, and the English-speaking peoples of North America maintained an almost unblemished record of respect for religious freedom through all the other changes that took place, until the past few years.

Starting with the school prayer decisions of the 1960s, this absolutist democracy was in its turn eviscerated by a creeping secularist coup d’etat emanating from the courts, which claimed a warrant from the Constitution. The courts were certainly mistaken in thinking the Constitution warranted a comprehensive secularization of American governance, but they seem to have been sincere. Later, as the rising imperial judiciary also became a key patron of the Sexual Revolution, the courts’ reasoning became so disgracefully inept that the possibility that the courts sincerely think they are doing anything other than arbitrarily legislating from the bench is hard to take seriously. Roe v. Wade was a brazen attack on democracy, and while it’s hard to say when the Rubicon was definitely crossed, in the wake of the Obergefell decree, I agree with Justice Scalia that “my Ruler, and the Ruler of 320 million Americans coast-to-coast, is a majority of the nine lawyers on the Supreme Court.” A country whose Constitution can suddenly, poof!, take on a new meaning that no one can seriously doubt would have amazed and disgusted its authors, and thereby override many democratically-passed laws and rob the people of the ability to legislate according to the majority will on an absolutely crucial social question, is not aptly described as a democracy. It might be best described as a judicial oligarchy in which elected elements play the chief administrative and a subordinate legislative role.

I’m not so fond of democracy that my loyalty to a regime would depend very greatly on its democratic character, but I am very, very fond of telling the truth, and I can have no respect for, and no loyalty to, judges who, in decreeing gay marriage, pretend that they’re interpreting the Constitution. Modern constitutional law is a lot like the Catholic Church’s theology of indulgences in the 15th and early 16th centuries. It makes very little sense, and every critical thinker more or less feels that it’s a disgraceful travesty, but people are afraid to challenge it as aggressively as reason demands, because it underpins the order of society. Reams and libraries are dedicated to rationalizing it, precisely because it’s rationally indefensible, yet is a crucial currency of power. And yes, I’d like to see modern constitutional law immolated in a kind of Lutheran Reformation, and would gladly pay a high price in chaos to see the dragon slain. Thanks to my low opinion of the US constitutional regime as it currently exists is one reason, I can contemplate with very little distress the immigration of a billion or so people from all over the world, unschooled in the peculiar mythology of early 21st-century American democracy and its ever-more-irrational cult of equality.

It would be interesting to hear the reactions to the billion-immigrant scenario, of people with a more favorable view of the legitimacy and beneficence of the present US regime.

Editor’s note: You might be interested in reading Nathan Smith’s follow-up blog post to this piece, A Billion Immigrants: Continuing the Conversation, where he fleshes out some of the arguments outlined in this blog post, and responds to some comments and criticisms of it.

Open Borders and the Hive Mind Hypothesis

April 27, 2015 Nathan Smith 5 Comments

I recently finished a (fairly advanced) draft of “The Global Economic Impact of Open Borders,” posted to SSRN here. Here’s the abstract:

Open borders, in the sense of the abolition of policies restricting migration, would cause billions of people to migrate, and result in almost a doubling of world GDP. Based on a model that stresses human capital as a determinant of the wealth and poverty of nations, but which also has a spatial element and allows total factor productivity to differ across cities, two openborders scenarios are constructed. In the first, “pure market clearing” scenario, world GDP rises 91% as 82% of the world’s population migrates, mostly to the West, and the living standards of unskilled workers worldwide rise to 26% of the US level. In the second scenario, with several adjustments made to favor greater realism at the expense of some arbitrariness, world GDP rises 85% as 58% of the world’s population migrates, and the living standards of unskilled workers worldwide rise to 31% of the US level.

For more on this paper, see my guest post at Market Monetarist last fall; and my three-part series on “Open borders and the economic frontier” (part 1, part 2, and part 3).

While I plan to do another round of revisions (a sorely needed Acknowledgments section is high on the priority list), I want to bring out some of the main themes of the paper, through blog posts at Open Borders: The Case. One of these is that while the claim that open borders would dramatically raise world GDP (“double world GDP” is the usual, sometimes criticized as over-optimistic but in my view apt, slogan) is robust to many changes in assumptions, it cannot withstand the “hive mind” hypothesis about the determination of GDP.

In technical jargon, the “hive mind” hypothesis is that TFP (total factory productivity) depends on human capital externalities. In non-technical language, the hive mind hypothesis is that people’s productivity and earnings depend, not so much on their own intelligence or skill, as on that of people around them.

(In the academic literature, Jones (2011), “The Hive Mind Across Asia,” seems to be the most prominent paper using the phrase “hive mind” in this sense, but Lucas (1988) is a seminal paper for the idea that human capital externalities are an important determinant of TFP, on which a large literature builds. John Lee comments here on how Docquier, Machado, and Sekkat (2014), the chief outlier among papers estimating the global economic impact of open borders, uses a form of the hive mind hypothesis to arrive at its conclusion that open borders would only raise world GDP by 4%.)

The principal motivation for the hive mind hypothesis is to explain the fact that highly skilled workers do not tend to earn more where skills are scarce. If anything, they earn more where they are abundant. A well-designed study by Michael Clemens uses the randomness of US visa allocations to show clearly that Indian software programmers earn far more in the US than in India, for reasons that seem to indicate higher productivity, since they’re working for the same companies, and the companies would have no reason to sponsor their visas if they didn’t anticipate a productivity increase sufficient to justify the higher salary. Against this, my own experience in Malawi taught me that what Amy Chua (2004) calls “market-dominant minorities” can achieve, in the poorest countries on earth, living standards much superior to those of middle-class Westerners in some respects (land, servants, to some extent leisure) while inferior in others (access to shopping, internet) in such a way that, overall, they might be rated as similar; and Chua (2004) gives very extensive evidence that this is true not just in Malawi but all over the world. My rough assessment is that while Indian software programmers might be far more productive in the US, the living standard earned by human capital is similar all over the world. (More precisely, the additional living standard that a worker with human capital equivalent to that of an average American will enjoy, over and above whatever a local unskilled worker would earn varies by less than an order of magnitude across countries.) Still, even if skills don’t earn less where they are scarce, they ought in theory to earn more, and that they don’t is a mystery demanding explanation.

Normally, a factor of production is most valuable where it is scarcest. Thus, water is intensely valued in California but less so on the rainy East Coast. Land is very expensive in Manhattan, where it is scarce (relative to population), but much less so in Montana, where there’s plenty of it. We should ordinarily expect the same thing with respect to brains, skills, human capital. They should be expensive where they are scarce, cheap where they are abundant. In fact, human capital seems to earn as much or more where it is abundant. To resort to technical language again (sometimes it clarifies) there is a correlation between average human capital and total factor productivity (TFP); and the hive mind hypothesis is essentially that this is causal, with the direction of causation running from average human capital to TFP. There may be a variety of reasons, e.g., smart people vote more like economists (so that democracy => good policy works only as well as the voters are smart), or smart people are better at cooperating, or maybe smart people need stimulation from other smart people to exercise and improve their intelligence. That’s the hive mind hypothesis in a nutshell. If you want more, ParaPundit’s post “Benthamite Libertarian Collectivists Wrong on Open Borders” has a good explanation (though without the term “hive mind”) with further links. Even better are the extensive contributions by anonymous commenter BK at the “Open borders and the economic frontier” posts linked above, and also here and here. Chaper 2 of Collier’s Exodus, which I review here, has what might be called an institutional spin on the hive mind hypothesis.

If the hive hypothesis is true (if average human capital is causally linked to TFP), what does it imply for open borders?

First, if the hive mind hypothesis is true, the impact of open borders on world GDP would probably be far less favorable than most of the existing estimates suggest. In one of the two model extensions that make TFP a function of human capital externalities, I find that world GDP falls by nearly one-quarter under open borders. One critique of open borders is that it would kill the goose that lays the golden eggs. The hive mind hypothesis is probably the form of “killing the goose” argument that has the best support in the literature at the moment.

Second, even in my most pessimistic hive mind scenario, unskilled workers worldwide end up with living standards 15% of the current US level, an order of magnitude above current levels. This is a counter-intuitive result, because in essence, what it shows is that the seemingly most pessimistic open borders scenario, killing the goose, and the seemingly most optimistic open borders scenario, the end of poverty, are actually not inconsistent! Even if the institutional harms/negative externalities/various downsides of open borders were severe enough that world GDP, far from doubling, actually fell substantially, yet billions of the world’s most destitute people would still see their incomes multiplied five-fold, ten-fold, or more, because they could live under institutions that, while much degraded relative to the pre-open borders rich world, were still a good deal better than those they suffer under today; and also because they would benefit from greatly increased opportunities for productive complementarity with skilled workers, which the status quo precludes. Is it worth reducing world GDP by one-quarter to raise the wages of the bottom billion ten-fold? Probably so, if it came to that.

Third– and this is why ParaPundit misses the mark– whatever the normative implications of the hive mind hypothesis may be with respect to immigration, they certainly do not suggest that the status quo is anything like optimal. If one’s goal is to maximize world GDP, the only advantage of the status quo, relative to open borders, is that it involves some human capital stratification, allowing today’s rich countries to be productive “hive minds” of high human capital people. But the migration status quo is a very suboptimal human capital stratification system. First, there should be open borders for smart people– no reason to shut them out– and the admission of people with high IQs and advanced degrees to rich countries could be far more automatic and transparent. We could create schemes to bribe low-IQ, less-educated citizens of rich countries to emigrate and surrender their citizenship, since such emigration should raise average human capital, and TFP, in the source country. We could establish charter cities for low-IQ people to emigrate to, and a bit of ongoing foreign aid might be a fiscal price well worth paying to have them out of the way. Meanwhile, we could establish gated communities for smart people, graduating them into increasing levels of self-government, until eventually they attain full independence as (not philosopher-kings but) philosopher-republics.

Critics of open borders from a hive mind angle, like ParaPundit, can be called on to explain why they don’t advocate a global program of maximal human capital stratification, since that’s what their arguments would really point to.

I’m skeptical of the hive mind hypothesis, and I don’t think open borders would kill the goose that lays the golden eggs; I think it would double world GDP. But I don’t rule the hive mind hypothesis out either, and it’s one of the most respectable reasons to dissent from claims that open borders would raise world GDP dramatically.

Overview of the Open Philanthropy Project’s work on migration liberalisation

March 18, 2015 Sebastian Nickel 2 Comments

[A draft of this post was reviewed by Alexander Berger, Program Officer for US Policy at GiveWell, and a number of changes were made to it based on his comments and corrections.]

Charity evaluator GiveWell seeks to identify underfunded charities that can provide clear evidence of positive impact. Making their list of top charities therefore requires that one do good in sufficiently uncomplicated ways, ideally through a straightforward chain of cause and effect. Open borders activism does not fit this description. However, in early 2013, GiveWell (GW) broadened their focus to include less tractable causes through the Open Philanthropy Project, a joint project of GW and the philanthropic foundation Good Ventures (GV). Among a few dozen general causes including criminal justice reform and geoengineering research, “international labor mobility” was put on the agenda no later than in May 2013. This post will give an overview of the work the Open Philanthropy Project (OPP) has done in investigating and funding migration related efforts in the last two years.

A shallow overview of “labor mobility” was posted on GW’s homepage in May 2013. The page credits two specific sources with raising GW and GV researchers’ interest in this cause: Michael Clemens’s article “Economics and Emigration” (the origin of the “double world GDP” estimate), and the conversation that GW and GV staff held with Lant Pritchett in June 2012.

The Open Philanthropy Project’s assessment of free migration as a philanthropic cause

Since the inception of the OPP, the researchers’ stated position has been that labour mobility holds potential for very large gains, mainly in the form of large wage increases for workers who migrate from low-income-countries to high-income-countries. This is in line with Michael Clemens’s argumentation, although the OPP’s position is more guarded in its assessment of the magnitude of the gains, stating little confidence in the output of the relevant models. (Note that Open Borders bloggers have also argued for a lower estimate than Clemens’s.) A back-of-the envelope calculation provided on the GW website nonetheless states that it may be appropriate to consider the “importance” of labor mobility to be in the low trillions of $/year, based on the assumption of 10% as much migration as expected under full liberalisation in the models used by Michael Clemens. Efforts to facilitate legal migration through information sharing and coordination are estimated to hold potential corresponding to hundreds of millions of additional $/year, and the Senate Comprehensive Immigration Reform bill is estimated to represent a plausible US policy path that would carry benefits in the low hundreds of billions of $/year for future migrants (these gains would be realised in 2033 had the bill passed in 2013).

Characteristically concerned with room for more funding, the OPP’s assessment considers the extent to which the cause is already crowded by other philanthropic organisations. Policy work concerned with the treatment of undocumented immigrants in the US and with high-skilled labour for US businesses is seen as very crowded. Crucially, however, the OPP’s globalist humanitarian perspective sets it apart from the vast majority of active philanthropists working on US immigration policy, whose focus seems strongly influenced by citizenism and territorialism: The OPP’s focus is primarily on the interest of the immigrants, not on the interests of US employers in search of labour. And their priority lies with low-skilled immigrants, who have the most to gain from labour mobility. And here, the cause is everything but crowded.

The shallow assessment of labour mobility from May 2013 raises the possibility of important downsides of migration liberalisation as requiring research, and takes no position on this side of the issue. A post published in July 2014 states (citing a conversation with Michael Clemens and announcing a forthcoming writeup of the evidence)

our current understanding is that best evidence suggests that both lower- and higher-skill immigration are net beneficial for current residents, though they have somewhat different distributional effects.

On the 3rd of September 2014, Holden Karnofsky posted a draft writeup on the likely impact of increased immigration on current US residents’ wages, which the OPP had commissioned David Roodman to write, stating

We haven’t yet fully vetted this writeup (something we are planning to do), but we believe it gives a thorough and convincing picture of the literature, and provides some reason to believe that immigration is unlikely to result in substantially lower wages (particularly over the long run) for current residents.

(See also Open Borders’ reference page on the potential suppression of wages of natives.)

As for how highly they have prioritised this cause compared with the other philanthropic causes on their list:

An update on the Open Philanthropy Project posted on the GW blog on 26 September 2013 described “deep investigations” of 7 philanthropic causes as a crucial next step, involving proactive grantmaking. Labour mobility is on top of the list.

A much later post from 29 May 2014 on “Potential U.S. policy focus areas” groups labour mobility together with “macroeconomic policy” under the heading “Ambitious longshots: outstanding importance”, and places “deep investigation” of these two causes on top of the agenda, as investigation into the more time-sensitive “criminal justice reform” was being paused at that point in time.

A new Open Philanthropy Project update on US Policy related causes was posted on 10 March 2015. It states:

Our highest priority is to make a full-time hire for criminal justice reform, factory farming (pending a last bit of cause investigation, focused on the prospects for research on meat alternatives), or macroeconomic policy. Our second-highest priority is to further explore international labor mobility and land use reform, areas that we find conceptually very promising but in which we aren’t currently aware of (multiple promising-seeming) potential grant opportunities, and accordingly aren’t ready to make full-time hires in. These priorities are followed by several issues on which we have a relatively specific idea of what we could fund, and the next steps would be to investigate in much greater depth to decide whether the specific potential grants were worth making.

A spreadsheet linked to from last week’s OPP update explicitly gives “labor mobility” the highest importance out of all OPP causes. (See the “Importance” column.) Unfortunately, this importance is not reflected by a corresponding number of funding opportunities.

Taking action

Since many of the causes taken on in the Open Philanthropy Project call for policy changes, GW’s and GV’s researchers have investigated expected costs and benefits of policy reform strategies. Vipul has written an Open Borders post about the conversation they’ve held on the topic with Steve Teles, and they have also held two conversations with Mark Schmitt. A series of blog posts from October and November 2013 outline some general conclusions on policy oriented philanthropy.

As previously mentioned, the “deep investigation” of the causes was to involve proactive grantmaking. A blog post from May 2014 describes how GW’s and GV’s researchers came to adopt this approach:

from observing the behavior of potential grantees and other funders, we came to believe that a funder must be highly prepared (and likely) to make grants in an area in order to find giving opportunities in that area. Many people will only make the relevant referrals, propose relevant ideas, etc. once they are convinced of a philanthropist’s serious interest in providing funding.

The term “Earning to give” is often used in the Effective Altruism community, and I imagine the parallel terminology here is intentional:

“Giving to learn” can mean multiple things. It can mean (a) funding research in order to gain specific knowledge; it can also mean (b) funding a project in order to learn from following the project’s progress. The dynamic laid out in the above bullet points represents perhaps the most counterintuitive meaning: “giving to learn” can mean (c) offering funding in order to learn from the process of finding grantees.

[Update: Alexander Berger tells me the parallelism is not intentional.]

Three grants and one potential top charity

The Center for Global Development (CGD) was awarded a grant for $1,184,720 over 3 years in March 2014.

This is the nonprofit think tank that employs Michael Clemens. As mentioned above, his publications were important in bringing the issue of labour mobility to GW and GV researchers’ attention.

In the aftermath of the 2010 earthquake in Haiti, Michael Clemens had advocated for making Haiti eligible for access to the H-2 temporary work visa program, as an outstandingly effective form of disaster relief. GW and GV researchers estimate that his efforts contributed significantly to the U.S. government’s decision to accept this proposal.

The grant will fund further research by Michael Clemens on “both marginal and more ambitious” changes to migration policy and its possible role in disaster relief. CGD will further use the grant money to launch a Working Group on Designing and Evaluating Bilateral Low-Skill Labor Mobility Agreements between high and low income countries. A Working Group on Creating a Migration-for Development Unit within the US Government will possibly also be launched.

While GW and GV are unsure of the marginal contribution the grant money will make to the CGD’s productivity in this area, they note that Michael Clemens’s work had very few sources of funding.

Follow-up is a crucial part of the Open Philanthropy Project’s process. The writeup states that they “expect to have a conversation with Dr. Clemens every 3-6 months for the duration of the grant to learn about the status of his research and advocacy efforts, with public notes if the conversation warrants it.”

Notes on a conversation with Michael Clemens held on 21 January 2015 were published last week. Highlights:

Recently, most of Dr. Clemens’ time has been dedicated to three working groups and one study group:

A working group on a bilateral labor agreement between the U.S. and Mexico. This project has been funded by Good Ventures’ grant.
A working group on creating a migration and development bureau within the U.S. government. This project has been funded by Good Ventures’ grant.
A working group on implementing global skill partnerships. This project is currently stalled, and it is unlikely that CGD will become involved in any global skill partnerships within the next year.
The Beyond the Fence study group, focused on the indirect effects of the drug war in the U.S., Mexico and Central America. This group’s work has been fairly light so far.

Some details on the first of those working groups:

The exact output that the working group will produce is itself a subject of discussion. It may decide to produce a document outlining particular features that a practical agreement would require and suggesting research needed. This could build upon current bilateral, interministerial cooperation happening between the U.S. and Mexico.

(…)

A primary goal of this group is to design a better system for pairing migrant workers with employers than the current H-2A temporary agricultural worker program. Employers perceive the H-2A program as an obstacle. The U.S. Department of Labor could potentially create a pilot of a program that is instead a useful service for employers, similar to New Zealand’s Recognized Seasonal Employer Work Policy or the work of CITA Independent Agricultural Workers Center.

The second half of the conversation notes provides a lot of detail on Michael Clemens’s numerous migration related research projects. The last section of the document states:

Dr. Clemens does not have a good metric for determining the influence of his work. His papers are frequently included in course syllabi, and two of his papers in particular, “Economics and Emigration: Trillion-Dollar Bills on the Sidewalk?” and “The Place Premium,” seem to receive significant attention.

The U.S. Association for International Migration and the International Organization for Migration were awarded a grant for $1,490,500 over approximately 14 months in July 2014, for a jointly submitted proposal that will involve three further organisations. Among these is the Center for Global Development, which will conduct an evaluation of the program to assess its impact.

The grant will fund a pilot program to familiarise U.S. employers with Haitian lower skill workers, and ensure the legitimate uptake of available temporary H-2 working visas.

Potential upsides of the project include the continuation of the program after the pilot study, and policy changes in response to the results of the evaluation.

A December update reports that the first phase of this program has gone satisfactorily (one of the initial criteria for disbursing a second tranche of funding was waived, as it was recognised in hindsight as unrealistic), and announces the launch of its second phase.

The same document on the conversation with Michael Clemens on 21 January 2015 as cited above also includes two paragraphs giving further updates on this program:

Sarah Williamson (Protect the People) and her team have not yet finalized the employers who will participate in IOM’s program to bring Haitian workers into the U.S. via the H-2A program. IOM plans to take leaders of Haitian agricultural associations on a “study tour” of American farms, with the hope that farmers will put in orders for Haitian workers after meeting these leaders in person.

CGD is preparing to run a survey to measure the effects of the program. (…)

ImmigrationWorks was awarded a grant for $285,000 in July 2014.

Quotes from the writeup to ponder:

We were not able to find any advocacy organizations dedicated to making the case that more lower-skill workers should be allowed to migrate on humanitarian grounds, and experts generally told us that they felt that there was not a major constituency for such a message. The only groups we were able to find advocating for more lower-skill migrants represent business in some capacity, and they are relatively small or do not focus primarily on lower-skill immigrants (…)

Said groups numbered 3, counting ImmigrationWorks. Further:

our understanding is that ImmigrationWorks is the only one for which lower-skill immigration is the top priority, and that it is much smaller than the others.

ImmigrationWorks’ stated mission is to organise small employers of lower-skill immigrants, and mobilise them to advocate in Washington D.C. and across the U.S.

Their stated principles involve: bringing annual legal intake of foreign workers in line with “the country’s labor needs”, ensuring better enforcement of immigration laws, finding “a way to deal realistically with” existing illegal immigrants (which can be neither amnesty nor deportation, as those are both deemed “unacceptable”), and making sure that immigration policy is handled at the federal level.

The writeup acknowledges a (low) risk that ImmigrationWorks will use the grant to move policy in a direction that GW and GV would consider actively harmful.

Beyond closing the organisations projected funding gap for 2014, the proposed uses for the grant are:

Advocacy for immigration reform (…) that includes an ample less-skilled worker visa program, by mobilizing business to advocate to “business-minded Democrats and pro-immigration Republicans.”
Public opinion research (…) to try to determine which messages work to persuade people of the need for lower-skill immigrant workers
Building consensus around policy (…) with the business community

Conversations with IW founder Tamar Jacoby are expected “every 2-3 months over the course of the year-long grant.” No update has yet been published (which does not mean that no conversations were held, as notes are published only for a minority of conversations).

Migration within national borders

Domestic migration may not be of obvious concern to bloggers devoted to Open Borders, insofar as the obstacles faced by the migrants do not include any political borders. But the work on seasonal migration within low income countries that GW and GV researchers have been following and funding is quite relevant to Open Borders advocacy as well.

Bryan, Chowdhury, and Mobarak have run randomised controlled trials in Rangpur, “a region of rural Bangladesh that persistently suffers from pre-harvest famines.” The trials were conducted over three years and involved 100 villages. This research finds that providing subsidies for seasonal migration can effectively increase migration and household consumption.

Evidence Action, the organisation that manages the GW Top Charity Deworm the World Initiative, is currently funding a 4,000 household study in northern Bangladesh “to explore further the potential of scaling up a migration subsidy program”. The OPP has made a $250,000 grant to support this work in March 2014, with the stated aim of supporting the creation of future Top Charities.

A more specific goal of this research is to empirically investigate a number of questions on unintended consequences of migration – some of which are frequently discussed here on Open Borders:

Does sending many unskilled laborers to a single city change wages?
Does migration influence housing prices at destination cities?
What kinds of housing opportunities are migrants finding?
Does migration affect food prices in villages of origin?
Does migration change gender dynamics (e.g., what changes occur when women are left at home to manage home finances when men migrate)?
Are there are any unintended consequences for households who do not send a migrant?

Provided that the results of this research are encouraging with respect to scalability, Evidence Action intend to significantly scale up their seasonal migration support program. We can hope to see a funding proposal later this year.

Conclusion

I am very impressed with the Open Philanthropy Project’s work on labour mobility. It is exciting to read about the specific action undertaken, and I can imagine their sheer demonstration of initiative having considerable power to shift people’s thinking on migration.

The researchers’ careful evaluation both of the importance of the cause of migration liberalisation, and of the amount of effort currently invested in the cause, seem to me to strongly confirm the views generally held on these issues by Open Borders bloggers. To recap some relevant highlights:

The OPP come out prioritising the cause of free migration very highly. If other causes are currently prioritised more highly, the stated reason for this is always that they are able to identify more funding opportunities in these other domains. Thus, when it comes to launching additional efforts to further a cause, increasing freedom of migration between low-income and high-income countries seems to be a plausible candidate for “most high impact cause to take on”.
The OPP have found no political advocacy group in the U.S. that promotes immigration of low-skilled workers on humanitarian grounds.
The OPP have found only three political advocacy groups in the U.S. that promote immigration of low-skilled workers at all, and they all do so with the aim of “advancing the interests of U.S. businesses”.
In contrast, there is plenty of philanthropic engagement in immigration-related causes that are consistent with extreme citizenism (bringing in more high-skilled labour to advance U.S. economic interests) and territorialism (defending rights of existing immigrants, but not the right to immigrate).

How do you convince people to sustainably support migration liberalization?

February 25, 2015 Vipul Naik 4 Comments

I think open borders is a radical proposal, given how far the world is from it. I also think that open borders (or even partial steps in that direction) will significantly transform the global economy, culture, and society, and the details can’t clearly be predicted. Economists have estimated that open borders will increase global production by 50-150%. Even though I think this might be overstated, I think that even with that overstatement, open borders is still worth pushing for, which is why I’m sticking with it.

If open borders is such a big deal and the consequences are so unclear and uncertain, why should people who are already well off support it? If you lead a comfortable life in the First World and are generally risk-averse, open borders may well not pass a cost-benefit analysis for you. You might gain somewhat economically and in terms of cuisine options, but on the other hand you might see a slight wage dip and have to deal with changes to your neighborhood that you may not like. Even if you gain a bit on net in expectation (and I think there are good reasons to believe that most First-Worlders will benefit from open borders, both as natives of countries receiving migrants and because their own migration options have increased), it may not be enough to get you excited.

Co-blogger Nathan says something similar when discussing differences between the open borders movement and the gay marriage movement:

An important difference between open borders and same-sex marriage is that it is widely and plausibly held (though I think it’s a half-truth at best) that same-sex marriage is a victimless reform which will have hardly any effect on the lives of non-LGBT individuals, or for that matter of LGBT individuals who don’t choose to marry. If so, supporting same-sex marriage isn’t just cheap talk but cheap action. Open borders, by contrast, will involve, if not perhaps great sacrifice, then certainly great upheaval. Many will benefit– perhaps wisely-designed policies could even ensure that everyone benefits— but lives and societies will be transformed. That doesn’t alter the fact that saying one is for open borders is a cheap and easy way to display one’s virtue and benevolence.

Economic illiteracy and xenophobia probably explain a large part of why the world is far from open borders, but even if you get rid of these, open borders simply isn’t an exciting proposition for many reasonably well-off First Worlders from a purely self-interested and risk-averse perspective. What I mean by this is that, if open borders were to become the status quo, they’d probably get used to it and be quite okay with it over a long timeframe. But it’s not something whose benefits are huge, tangible, and clear.

For me in particular, open borders is interesting because of its global impact (undoubtedly, I would likely personally benefit from it, but not enough to justify all the time and effort I’m spending on it). But most people aren’t that interested in global impact. They (rightly or wrongly) care about their personal lives and their neighborhood (hence all the focus on territorialism, local inequality aversion, and the border as blindfold). They may bear no ill-will to foreigners but aren’t particularly concerned about them.

Given that freeing up migration often involves changing policy in receiving countries, how do we overcome people’s apathy/risk-aversion, even assuming we could overcome the arguably bigger problems of economic illiteracy and xenophobia? What’s a sustainable way of doing this? In this post, I discuss three strategies:

Glossing over harms and exaggerating benefits
Buying support
Moral inspiration

After discussing them, I outline my own ideal strategy mix. Continue reading How do you convince people to sustainably support migration liberalization? →

How rational can we expect nation-states to be in setting immigration policy?

June 3, 2014 Vipul Naik 1 Comment

A recent comment by Christopher Chang made a point that I feel we haven’t adequately addressed on this site: if open borders is such a great deal, why has nobody tried it? Using a similar structure of argument as Bryan Caplan employed in his blog post on motivating sheep or Gary Becker employed in the now-standard argument that market forces gradually erode discrimination, Chang writes:

It does not matter if 90% of actors are inefficiently biased, as long as some subset of the other 10% knows what they are doing; that subset, and its future imitators, win in the long run. This has happened over and over and over again in political, economic, and military history. Both you and Paul fail to comprehend the nature of “collective assessment” that requires only one yes vote. As I’ve mentioned numerous times, you can even provide much of the yes vote yourselves, and according to all your economic claims, this would be quite lucrative. (This does not mean that any particular individual’s failure to do so is damning; life circumstances frequently interfere. But the fact that none of you have done anything like this does, in fact, add up to a strong revealed preference against your claims. Your failure to even seriously openly discuss this among yourselves strongly implies that you do not actually want your rosy projections tested.)

I like the general reasoning behind the generation of these types of questions. Claims that the status quo is radically suboptimal should be met with skepticism, and should be taken seriously only if the people making the claims can offer a convincing explanation for why the suboptimal system is stable. In this post, I explore some possible explanations. Read and judge their strength for yourself!

Note that this post is not, in and of itself, a complete argument for open borders, or open borders with keyhole solutions, being optimal. It’s rather an explanation for how the current state of the world (far from open borders) is consistent with the possibility of open borders being a lot better. It seeks to address a potential inconsistency, rather than offer complete proof. Therefore, my rhetoric in the post will assume the open borders position and simply demonstrate that there are no obvious contradictions.

There’s a connection between this post and my earlier post on whether migration levels under open borders would be optimal, too high, or too low. But whereas that post is about the decisions of individuals holding state policies constant, this post is about the creation and tweaking of the policies themselves.

#1: The gains from pure open borders go to quite an extent to migrants and their descendants, and even though existing residents of migrant-receiving countries gain somewhat, the gains are a lot less

Why don’t we have pure open borders, if it benefits the world so much? The short answer is that the people with the power to decide this (the people in political power and the voters and special interests that they cater to) are not the people who benefit the most from open borders. As Nathan Smith notes here and here, immigration policy is quite “undemocratic” in the sense that potential immigrants have no (direct) electoral say in a matter that affects their freedom.

This point has a number of different aspects:

If the gains from migration went mostly to the immigrants and not to non-immigrants in the target country, the people who gain the most don’t have a say in the electoral process. Note that this point is valid even in the absence of disparity or asymmetry between nations. If immigration from Canada to the US significantly enriches the Canadians who migrate to the US, but has little effect on US natives, then US natives (who vote in the elections) have little incentive to push for freer migration from Canada.
One possible remedy to the above would be to push for free migration through reciprocity, for instance, freeing migration from Canada to the US in exchange for freeing migration from the US to Canada. This would work in the case that the fraction of the population in either country that has an interest in the option of migrating is large enough: if enough Americans want the freedom of easy migration to Canada, they may vote for a treaty that frees migration both ways. If, however, the fraction of people interested in migrating is small, then they may not be able to push for freer migration even if the absolute gains they experience are huge. That’s because democracy is based on counting votes, rather than on winners compensating losers.
In the current world, there are significant international disparities in wealth and wages, and a strong directionality to potential migrant flows. In light of this, the spotlight falls on the migration policy of countries that have greater per capita income or wages or are otherwise attractive migrant destinations. The degree of solidarity between potential migrants and the set of people who have the most influence over the most relevant migration policy is now quite low: the former are people from low-income countries, and the latter are people of prosperous countries. Even though the latter set is expected to gain somewhat in expectation, the gains are smaller in absolute terms, and even smaller when viewed as a proportion of how well off they currently are.

Note that many of these can be fixed, at least in principle, if we relax from pure open borders to open borders with appropriate keyhole solutions such as pro-native tax-and-transfer schemes. So why don’t we have instances of the latter? Actually, we do, to some extent. We’ll get to this later in the post.

#2: The full gains from open borders take time to materialize

Estimates of significant increases in world production after open borders are not estimates of overnight gains. Rather, these are estimates of how the world would look a decade or two from the opening of borders, relative to how it might look in the counterfactual. Even if the estimates were correct, the full magnitude of the gains would be felt after a fairly long time-lapse. Thus, there may not be good electoral incentives for democratic governments to support freer migration for the economic benefits. Some of the economic benefits would be reaped immediately, but it would be an order of magnitude less than the long-term gains. Note that this is similar to the reason why we expect individual migration to be less than what seems economically optimal, as discussed in my other post.

#3: In so far as there is a citizenist case for open borders, it relies on a tax-and-transfer scheme combined with somewhat draconian enforcement

Nathan Smith has previously argued that there is a citizenist case for open borders: use a tax-and-transfer scheme such as immigration tariffs or DRITI to hold natives harmless and distribute the gains away from migrants and towards natives.

Schemes like DRITI present a dark side: they exacerbate the visibility of poverty and, even as they reduce the unfairness of the system as a whole, make it more visible. So, in addition to open borders advocates who’d worry about such schemes (see, for instance, here and here), there are many others, such as immigrant rights activists, who would reject these schemes. Even if open borders started out with such “keyhole solutions” it’s not clear that they’d be stable.

The combination of citizenism and the form of local inequality aversion make tax-and-transfer-based keyhole solutions a hard sell in many countries. I don’t think the problems are insurmountable. But I don’t think it’s surprising that we haven’t seen a lot of progress on these so far. It’s fruit, but it’s not very low-hanging fruit.

Incidentally, one prediction of this setup is that countries that are less democratic, and where governments have more authority to carry out more draconian enforcement, might be more likely to have implemented citizenistic migration liberalization. This is indeed the case, as we’ll see in #5.

#4: The incentives of democracy

The incentives of the politicians and bureaucrats running the government are not perfectly aligned with the long-term interests of the citizens. There are two broad problems:

Citizens themselves don’t know what’s best for them, so they may not reward their representatives in government for choosing better policies or delivering better outcomes.
Politicians often cater to special interests rather than the needs of citizens.

In the context of why there hasn’t been more significant migration liberalization, I expect (1) to be a far bigger reason than (2). The general phenomenon of political ignorance in the electorate in advanced democracies has been well-studied (the political knowledge elsewhere is highly unlikely to be better, and quite likely to be worse). Explanations such as rational ignorance and rational irrationality have been offered. Given generally low levels of political knowledge and decision-making skill on the part of the electorate, we shouldn’t have strong reason to expect a democracy to converge to a good outcome. But we might still expect that, by random chance, some democracies would converge to good outcomes in a given area. So a bit more is needed.

Bryan Caplan has posited that one particular aspect to voter irrationality is anti-foreign bias: people systematically underestimate the benefits of interactions with foreigners. Are people inherently anti-foreign? I think that people have inherent tendencies to support their ingroup and resent or discount the welfare of outgroups. But the particular use of nationality as the criterion to define ingroup and outgroup is probably an artifact of the political process: there is an existing governance infrastructure that facilitates discrimination on the basis of nationality, and an existing ideological infrastructure that gives particular importance to national identity. So people’s diverse ingroup-outgroup choices get projected to divisions based on nationality and citizenship even if that’s not the best way of describing the distinctions in their own minds. The upshot is that we might expect the political process to produce an anti-migration bias relative to what’s optimal, and while this reflects some discomfort that individuals experience interacting with foreigners, it’s often a result of a political process translating other forms of discomfort people have to the language of discrimination based on nationality (this is a somewhat tricky point, and I hope to elaborate in a future post).

#5: Some countries that are undemocratic or less democratic, and have more deference for elites, tend to have citizenistic and numerically liberal migration policies

Carl Shulman has been doing yeoman’s work of late examining some interesting “open borders with keyhole solutions”-type regimes. He looked at Singapore in a blog post titled Migration levies and unskilled labor mobility in Singapore, where he discussed Singapore’s large temporary guest worker program for low-skilled migrants, that combines fairly huge numbers of migration with fairly stringent restrictions on what migrants can do, as well as taxes on the migrants that make them fiscally good for the government. In a blog post titled What does migration to the United Arab Emirates tell us about labor mobility?, he looked at the UAE, where a significant majority of the population is foreign-born, and where there are significant differences between the rights and privileges accorded to a native elite and a large foreign-born workforce. In both cases, their policies created a win-win for natives, the government officials, and migrants. In Singapore, the success of these policies arises from an effective one-party system and considerable deference to elites in policymaking, despite the general population being less pro-migration than in many First World countries with far stricter limits on migration. The UAE is a federation of hereditary monarchies, which insulates it from the pressures of competitive democracy. The population is also less likely to push for liberal ideals of equality that jeopardize the stability of keyhole solutions.

Relatedly, a recent book called The Price of Rights by Martin Ruhs (to be reviewed later) empirically came to the conclusion that there’s a trade-off between the number of migrants a country admits and the package of rights that are accorded to people after they migrate. A similar point had been made in a post by Michael Carey a while back on immigration and class struggle. If modern liberal democracies tend to be strong on the package of rights and privileges, this (often) comes at the expense of the number of migrants they admit.

#6: If many countries tried citizenistic open borders, competition would drive down tariffs eventually, bringing the world closer to open borders

In #1, we (sort of) ruled out the plausibility of pure open borders (barring dramatic changes in people’s views of moral permissibility and side-constraints). But in #5, we pointed out that we do have partial approximations to “open borders with keyhole solutions” and these could be taken further. So how far are “open borders with keyhole solutions” from pure open borders?

We can think of pure open borders as migration with zero government-imposed barriers or taxes. Suppose most countries have prohibitively high barriers, and a few countries experiment with selectively reducing taxes to the level of “open borders with keyhole solutions.” These few countries can still afford to keep the taxes at their profit-maximizing level, because they’re effective monopolists: all the other countries are out of the running because their barriers are too high. The policies of these few countries are a Pareto improvement over the status quo, but they still carry the inefficiencies of a monopoly. If, however, more countries start getting drawn into the game of open borders with keyhole solutions, then there is more competition between countries that exerts a downward pressure on the taxes and barriers. Thus, as more countries do it, we get closer to open borders. We probably don’t get anywhere near pure open borders, but we do get a lot closer than if only one or two countries were trying it out.

PS: Open borders isn’t the only policy proposal for which we can ask this sort of question. I’m quite curious to hear the thoughts of proponents of drug legalization, free trade, organ trading, and other such cutting-edge proposals. The situation with some of these seems to be a bit better than for open borders, but not by a huge margin. For instance, consider the case of drug legalization. According to this Wikipedia page, there is only one country, Uruguay, where the possession, sale, transport, and cultivation of cannabis (marijuana) are all legal. But there are a number of nation-states (plus member states in nations) where the possession of marijuana is legal, or illegal but decriminalized, and there are others where marijuana use is de facto tolerated. So even though full-blown legalization is rarely embraced, we have enough variation in the direction of legalization to address the question of “if it’s such low-hanging fruit, why has nobody plucked it?” This is roughly similar to the situation with open borders.

PS2: I wrote up a condensed version of an early draft of this post in the form of an Open Borders Action Group post.

Open Borders: The Case