Tag Archives: suppression of wages of natives

Open Borders and International Migration Policy: Book Summary

December 11, 2015 Joel Fetzer 4 Comments

This blog post summarizes the author’s October 2015 book Open Borders and International Migration Policy. The book is available both electronically and in print from Amazon, Google Books, and the publisher, Palgrave MacMillan.

Although political philosophers debate the morality of open borders, few social scientists have explored what would happen if immigration were no longer limited. This book looks at three historical examples of temporarily unrestricted migration into the United States, France, and Ireland: the arrival of Mariel Cubans in Miami (Florida) in 1980, the flight of Pied Noir and Harki refugees from Algeria to Marseille in 1962, and the migration of Poles and other new European Union ‘Accession 8’ citizens into Dublin in 2004. Based on personal interviews, archival research, and statistical analysis, the study finds that the effects of these population movements on the economics, politics, and social life of these cities were much less catastrophic than opponents of free immigration claim. Detailed chapters cover schools, crime, ethnic politics, unemployment and wages, public finances, housing, and racial violence.

Open Borders: The Case editorial note: See our background page on the Mariel boatlift.

Political philosophers Joseph Carens, Catherine Wihtol de Wenden, and Will Kymlicka have argued for the morality of an open-borders immigration policy, yet such other social theorists as Michael Walzer, Stephen Macedo, and John Isbister dismiss this approach because of the supposed harm that unrestricted immigration would cause to natives. After exploring the normative arguments for and against open borders, the first chapter concludes that the crux of many theoretical objections to unrestricted immigration is empirical. Unfortunately, however, many of the factual assumptions that immigration restrictionists make have not been fully or rigorously tested. This new book therefore aims to see if unregulated immigration actually hurt natives.

The following chapter replicates David Card’s 1990 now-classic, natural-experiment-based article demonstrating that the Mariel migrants had no significant immediate effect on native wages or unemployment rates in Miami. Chapter 2 extends Card’s findings to two European cities that experienced sudden waves of migration comparable to the Mariel Boatlift in south Florida: Marseille, France, which faced the influx of Pieds-Noirs and Harkis “repatriates” from Algeria in 1962; and Dublin, Ireland, which received thousands of new European-Union, “Accession 8” citizens from Eastern Europe beginning in 2004. Based on elite interviews, archival materials, and ARIMA regression models, this study of two additional natural experiments concludes that rapid, “uncontrolled” migration had no statistically significant effect on the native employment market in Marseille or Dublin. The analysis likewise finds that sudden immigration appears to have boosted overall wage rates both in Marseille’s total employment market and in Ireland’s construction sector. Theoretically, this investigation thus confirms Card’s optimistic conclusions about the economic effects of immigration. It also shows that his findings are robust across different Western, industrialized countries.

Open Borders: The Case editorial note: See our background pages on suppression of wages of natives and the US-specific version.

Chapter 3 focusses on public finances. Although popular rhetoric about “immigrants taking our jobs” or “reducing our wages” typically finds little or no support from rigorous empirical studies, such mainstream investigators as the National Research Council conclude that new immigrants sometimes represent a net fiscal burden, especially at the local level in the short run. To estimate the largest-possible immediate effect of various types of migrants on the finances of large cities in particular, this chapter analyzes over-time budgetary data from Miami, Marseille, and Dublin. Based on quantitative panel models, elite interviews, and archival documents, the study concludes that the overall fiscal impact on localities of rapid, “uncontrolled” migration was effectively nil in Miami and Marseille, but positive in Dublin. Theoretically and empirically, this investigation helps estimate the upper bounds of the possible tax- and social-services-related effects of rapid, unrestricted immigration into an urban area and partly confirms the relevant literature on the differing fiscal influences of refugees versus economic migrants and high- versus low-skilled labor.

The fourth chapter looks at the housing market. Unless public authorities and the private real estate market immediately increase the number of available dwellings, a sudden wave of immigration may increase residential overcrowding. According to standard economic theory, greater demand for housing should likewise boost prices in the rental market, where most immigrants would initially seek shelter. In contrast, interpretations based on a dual housing market predict that immigration-caused demand will not be as likely to boost natives’ housing costs where newcomers are highly segregated. To test these two explanations, this chapter uses interviews with local economists and real estate agents, historical documents, and panel regression models for the three historical natural experiments. Quantitative data include official census statistics on the number of people per room and public or private estimates of changes in rents. Regression models suggest that increased overcrowding occurred in Miami but not in Marseille or Dublin. In contrast, the analysis shows a significant migration-caused rent increase in the normal housing market of only Marseille, the least-segregated city. Theoretically, this work thus tends to confirm the theory of dual housing markets for immigrants versus natives but only partially supports the standard economic model of housing.

Open Borders: The Case editorial note: See Nathan Smith’s post The great land value windfall from open borders.

Chapter 5 concerns itself with schools. Popular rhetoric claims that because of immigration, native schoolchildren have “no room to learn” and educational standards are being “dumbed down.” Yet relatively few empirical social scientists have examined whether immigration actually causes school overcrowding. A larger group of statistically oriented scholars has examined migration and academic achievement, but they tend to focus more on how well migrant students do in school than on whether immigration hurts native children in the same district. The smaller pool of investigators who have looked at this latter question usually aim to test the “peer effects” theory of immigration effects but often are confronted with the serious methodological problem of endogeneity via immigrant and native self-selection into particular districts. To estimate the largest-possible immediate effects of various types of migrants on the degree of overcrowding and academic achievement in secondary schools in large cities in particular, this chapter therefore analyzes official over-time classroom-density and test-score data from these three natural experiments where immigration is clearly exogenous to the choice of school district. Based on interviews with teachers and school officials, examination of archival materials from relevant institutions, and quantitative panel analysis of educational and census data, my study concludes that the rapid, unrestricteded migration of immigrant secondary-school students neither substantially increased classroom density nor affected the overall test scores in these districts. Theoretically and empirically, this investigation helps estimate the upper bounds of the possible education-related effects of rapid, unrestricted immigration into an urban area and disconfirms an immigration-based “peer effects” model of academic achievement. Massive immigration does not necessarily cause a decline in student learning, and it does not even seem to boost classroom overcrowding very much if at all.

Crime is the main topic in Chapter 6. Although xenophobic popular rhetoric about “foreign-born criminals” abounds, relatively few empirical social scientists have examined what, if any link, actually exists between immigration and crime. Those quantitatively oriented investigators who do look at this question, moreover, typically focus on a single country or region and tend to find little or no overall effect from migration. This chapter thus uses cross-national statistics to test the “strain” and “importation” models of migration and criminal deviance. To estimate the largest-possible immediate effects of various types of migrants on the level of violent or “serious” crime (i.e., homicide and burglary) in large cities in particular, I analyze official over-time crime data from the three cities. Elite interviews, archival materials, and quantitative panel models of police and census data indicate that the rapid, “uncontrolled” migration of working- or middle-class refugees or workers did increase burglary rates in all three cities. However, the sudden arrival of primarily low-skilled individuals—some of whom had already served prison time in Cuba—appears to have boosted the homicide rate in Miami only. This investigation therefore helps estimate the upper bounds of the possible crime-related effects of rapid, unrestricted immigration into an urban area and partly confirms the importation model of homicide and strain theory of burglary. Though massive immigration does not necessarily cause a large rise in all forms of urban crime in the host country, the entry of many poor migrants with few economic opportunities and/or with criminal backgrounds may.

Open Borders: The Case editorial note: See our crime page, our backgrounder page on Hispanic crime and illegal immigration in the United States, and Vipul Naik’s speculative post about crime in the US under open borders.

The last body chapter examines ethnic politics and racial violence. Although some scholars of “realistic group conflict” argue that immigration-related ethnic conflict usually increases with a sudden influx of foreign-born residents, Daniel J. Hopkins’ theory of “politicized places” suggests that the effect of immigrant flows may partly depend on “salient national rhetoric.” To help adjudicate between these two theoretical explanations cross-nationally, this chapter analyzes over-time, aggregate voting data and qualitative accounts of inter-ethnic violence from the three urban natural experiments. Relying on elite informants, archival materials, newspaper accounts, and Gary King’s method of ecologically inferring the degree of ethnic voting, the study generally confirms the “politicized places” interpretation. While rapid, “uncontrolled” migration fueled ethnic voting and violence in Miami, where the media and many elites blamed economic woes on the immigrants, migrant inflows had few such effects in Marseille and Dublin, where media treatment was relatively positive and most leaders welcomed the newcomers relatively early on. Theoretically, this investigation thus expands Hopkins’ theory to immigrant-rich urban settings in three different industrialized countries. The chapter might also guide local and national political leaders wishing to avoid a popular backlash against an unexpected wave of recent immigrants.

Open Borders: The Case editorial note: See our background page on nativist backlash.

Chapter 8 summarizes the book’s findings and discusses their implications. Overall, this study concludes that the empirical case against open borders is overstated. The analysis does find overcrowding of housing and a higher burglary rate for all three cities. In Miami only, migration also appears to have led to more homicides, racial violence, and ethnic voting. Residential overcrowding eventually dissipated over time, however, as municipalities built more apartments for the newcomers. Burglaries did increase, but many of the victims were probably the immigrants themselves. Ethnic scapegoating by political and media elites lies at the root of ethnic voting and racial violence, and the many additional murders in Miami arguably represent an atypical case of a sending country deliberately inducing the emigration of violent criminals. With the exception of crime, then, any significant effects from large-scale immigration seem manageable.

On the other side of the coin, what if anything good came of these three migrant streams? First, moving to the U.S., France, or Ireland was undoubtedly good for almost all of the immigrants themselves. Most Mariel Cubans were able to rejoin their families in Miami and eventually move up into the American middle class. Pieds Noirs in Marseille escaped near-certain death at the hands of the Algerian FLN and eventually were able to re-establish their cultural institutions and economically integrate into southern France. And Poles in Dublin found reasonably well-paying jobs, a compatible cultural environment, and a chance to perfect their English. Second, however, these newcomers also contributed greatly to their host societies. Mariel migrant Mirta Ojito grew up to become a journalism professor at Columbia University and win the Pulitzer Prize. The Jewish Pied Noir singer Enrico Macias (born Gaston Ghrenassia in what is today Constantine, Algeria) continues to charm French and global audiences with his Andalusian melodies. At least at the height of the attendant labor shortage, meanwhile, Irish employers eagerly hired Eastern-Europeans to help fuel the Republic’s “Celtic Tiger” economic expansion.

Of course, these three case studies do not constitute the most extreme scenarios of unrestricted immigration, where tens of millions of people might cross international borders suddenly. Within the North Atlantic communities, however, these three examples represent some of the most dramatic and highly concentrated migration flows in modern memory (the not-yet-concluded Syrian refugee crisis aside). A complete lack of enforcement on the southern borders of the E.U. or U.S. would of course encourage larger numbers of poorer migrants to attempt the journey and might cause more significant socio-economic effects on the receiving countries. Yet until such immigration actually occurs, we are reduced to speculating about the consequences. And the analysis of historic cases in this book would be a good place to start developing models of the short-term, localized results of such overwhelmingly large flows should they present themselves. For now, however, any estimation of the socio-economic effects of truly massive, hemisphere-wide open borders requires forecasting beyond historically available data.

Open Borders: The Case editorial note: See also John Lee’s blog post How did we come to be so certain that closed borders are our salvation?

Perhaps the most morally defensible but cautious immigration policy politically imaginable would be the late economist Julian Simon’s recommendation to “increase the volume of total immigration in substantial steps [i.e., up to double the number of entrants per step] unless [or until?] there appear negative effects that are unknown at present.” As my book shows, actual harm from immigration is much harder to find than allegations of deleterious effects. If North Americans are to adopt immigration laws in keeping with their high professed ideals, they might profitably consider following the lead of the Europeans and South Americans–who have already adopted limited open-borders systems–instead of using racialized rhetoric to scapegoat men and women who desire nothing more than an opportunity to earn decent wages and live in peace.

Open Borders: The Case editorial note: See also Vipul Naik’s post Slippery slopes to open borders and John Lee’s post Constitutionally entrenching migration as a fundamental human right: Argentina and open borders.

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).

Paul Graham on US immigration policy and high-tech programmers

December 28, 2014 Vipul Naik 6 Comments

I’m a great fan of Paul Graham, essayist, entrepreneur, and co-founder of startup accelerator Y Combinator (along with his wife Jessica Livingston, whom I also admire greatly). Through Y Combinator, Graham has changed the startup and tech company landscape and profoundly affected the world. (Some Y Combinator-funded companies you’ve probably heard of are Reddit, Airbnb, Dropbox, Scribd, Disqus, and Stripe). Graham also started Hacker News, a Reddit-of-sorts for the programmer/startup crowd. In the world of letters, Graham is better known for his long-form essays that include incisive social commentary. If you haven’t yet read his pieces, I encourage you to check them all out (I particularly like this one, that might be somewhat relevant here). He’s done more for the world than most people, including me, could dream of. And he knows a lot more about how the world works than I do.

Recently, while investigating the reasons for a surge of traffic to the site from Hacker News, I came across Paul Graham’s essay Let the Other 95% of Great Programmers In. Though I was in broad agreement with Graham’s premises and conclusions (which broadly agree with the innovation case for open borders), I found some of the argumentation weak. In many ways, I thought that Graham both overstated and understated his case. He conceded too much to citizenism and to flawed framings of the issue, even if he didn’t directly endorse them.

A warning at the outset: it is quite possible that I am mistaken. In fact, given Graham’s substantially greater knowledge of the issues, your Bayesian prior, as you start reading this, should be that I am mistaken and Graham is right. But also consider another possibility. As Graham himself said, there are some things he can’t say. Graham is a contributor to high-tech immigration advocacy group FWD.us (see Nathan’s post on them). In that capacity as well as in his capacity as Y Combinator partner, he is keen to see high-tech immigration reform actually achieved. Even if he is broadly sympathetic to freer migration for all, coming out in favor of that might be a risk he’s not willing to take if it jeopardizes high-tech reform (relatedly, see my post on the dearth of moderates’ critiques of open borders). Thus, it could well be that my criticisms of Graham are epistemically correct but that his apparent results are a reflection of political savvy rather than intellectual sloppiness.

Paul Graham, Congressman Mike Honda, and founders of some leading Y Combinator-funded companies at a FWD.us event on high-skilled immigration to the United States. Source: FWD.us

Here’s my “list of N things” of criticisms, followed by elaboration of each:

The 95% statistic is a gross exaggeration: Graham’s framing, and his choice of title, radically overstate his case. His actual text, if read carefully, is less misleading.
Graham overstates the need for reform specifically targeted at exceptional workers: He overstates the case for letting them in, and the difficulties they face.
Graham understates and undermines the importance of letting in the merely competent: The merely competent include many who may go on to become exceptional. They support the exceptional through division of labor and comparative advantage. And their children may go on to become exceptional.
Graham concedes too much to the flawed jobs-and-wages-focused economic framework: He tacitly endorses the view that it’s somehow bad for companies to let in workers for the purpose of cutting costs. But cutting costs (holding the quality of service constant) is critical to economic and social efficiency.
Graham couches things too much in the language of American competitiveness: He is right that there is a chance that the global hub could move out of Silicon Valley due to poor policy choices (including immigration policy and local land use policy). But the sad thing about this cost isn’t so much that America loses out, it’s the huge social and global costs of the transition.

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How did we come to be so certain that closed borders are our salvation?

July 30, 2013 John Lee 15 Comments

Editorial note, added December 26, 2014: Welcome, Hacker News readers! This website is devoted to discussing the case for open borders, including the moral arguments for it and the practical question of how to get there. To address concerns surrounding migration liberalization, we suggest keyhole soutions and slippery slopes to it. For more about the site, you might want to read our site FAQ. Another post that you might find particularly relevant is Nathan Smith’s post on Mark Zuckerberg and FWD.us.

One puzzling thing I notice about debating immigration is how certain people often are that strictly restricting immigration is the right policy. Almost any person, when prompted, can articulate almost immediately a tonne of reasons why restricting immigration makes sense:

National governments have carte blanche to exclude any foreigner from their territory as matter of moral right
Open borders would let terrorists into our country
Open borders would let foreigners steal jobs from our people
Open borders would allow a foreign people to invade and steal our country from us
Permitting immigration imposes foreign cultures on our people
Immigrants will abuse our welfare system
Immigrants will undermine our institutions and replace them with their inferior ones
Liberalising immigration won’t really help poor foreigners anyway
Too many immigrants will swamp our territory or society to the point that it cannot function any longer
Letting in low-IQ/-skilled immigrants harms our economy or polity

But for some reason, the same people eager to expound on the litany of catastrophic harms that would no doubt ensue under open borders are rarely able to cite any sort of academic literature that backs them up. Their best retort, in terms of academic prestige, is George Borjas’s work on immigration’s impact on American wages, and maybe Robert Putnam’s work suggesting that diversity reduces some theoretical measure of “social capital”. You can’t find any empirical estimates that seriously support the above hypotheses — at least not to the degree that has people so certain the only right immigration policy is building a better and higher prison wall.

Now, if you turn the above propositions around, on all of them, we are either certain that open borders is immensely beneficial, or we’re just unsure. We know for a fact that liberalising immigration immensely helps the poorest human beings alive. Hardly any serious restrictionist disputes this; the only ones I’ve encountered who do are basing their certainty on foundations of sand: the most memorable example was a person who suggested that estimates of the place premium are wrong, because when you adjust for purchasing power parity, people in poor countries have better living standards than people in the US — such an economically-illiterate claim that it doesn’t even merit a rebuttal here. Most restrictionists are happy to concede that immigrants are made better off — they just believe that the act of immigrating makes natives dramatically worse off.

But the propositions to do with crime and “job theft” are our runners up for certainty: in the empirical literature, it’s difficult to find any serious social scientist who believes immigration increases crime rates, especially in a significant manner. And among economists, Borjas alone sticks out like a sore thumb for producing estimates showing dramatic depression of native wages (“dramatic” being a short-run reduction of a few percentage points). If there are any serious peer-reviewed, published analyses showing immigration leads to a significant spike in crime, or any landmark studies besides Borjas’s contradicting the economic consensus, I’d love to see them, because they seem to have slipped the minds of the restrictionists I’ve met so far.

Still, for virtually all the other propositions above, the evidence is either limited, decidedly mixed, or both. The long-run institutional, political, and societal effects of immigration have not been thoroughly studied in an empirical manner. But assuming we place the most weight on these outcomes (and ignore the other findings on the economics and crime of immigration), this means we ought to be cautiously uncertain about what the right immigration policy is. It means that even if we favour restrictionist policies, we do so with great uncertainty.

Yet the spectre of open borders seems to produce a stout certainty on the part of many people, who even if they aren’t dedicated restrictionists, seem quite convinced that the status quo or something close to it is certainly the right and best policy, given what we know now. There is strong certainty that a more liberal immigration policy of any kind would be a horrible idea. Yet engaging with these pro-status quo or even pro-closed borders assertions, one finds them disappointingly devoid of empirical backing.

The best ace the restrictionists have in their back pocket is the nuanced argument that reducing the proportion of high-IQ people in an economy below a certain percentage, or raising the proportion of low-IQ people in an economy above a certain percentage, would lead to a slowdown in innovation or corrosion of successful institutions. But even this claim is problematic, since it is difficult to tell how far IQ and economic growth and innovation are causally linked. And if having low-IQ immigrants is so devastating, this effect should surely be easy to demonstrate through meaningful measures of harm: slower economic growth rates, fewer number of patents filed per capita, higher crime rate. If we can’t observe these harms at existing levels of immigration — and, it bears repeating, the overwhelming majority of the empirical literature cannot find any such meaningful harms — then right now we are simply worrying about IQ for the sake of worrying about IQ.

If this whole post seems wishy-washy, since I’m essentially conceding that we are uncertain about the effect of open borders on quite a few dimensions, you’re partly right. But it’s more accurate to say that we are just as equally quite uncertain about the impact of closed borders, and to the extent we know anything with certainty, it’s how devastating they are. We can’t even rule out that closed borders are incredibly harmful to us on a number of dimensions (a straightforward reading of the empirical literature suggests that if you want to cut crime rates, you should subsidise immigration). Worse still, given the consistency of the literature regarding the impact of closed borders on the world economy and global poverty, we are absolutely certain that closed borders keep millions of people in poverty of the worst kind. We know that on average, the effect of closed borders halves the world economy.

Even if you think that the status quo of closed borders is right, it is worrying how uncertain we are about this conclusion. In many cases, the issues at hand simply haven’t been studied enough, and we know virtually nothing (we certainly don’t know enough to support most common restrictionist assertions about immigration). We do know the incredible destruction that closed borders wreaks on the world economy and the people of the world, to the tune of halving world GDP and keeping millions in poverty. We ought to have our top men and women working on figuring out whether we can crack the borders open at all. The fact that we don’t means we are simply irrationally certain that closed borders is the right answer. And that irrationality strikes me as best summed up in this 1881 cartoon, depicting Irish immigrants to the US — men and women bringing terrorism, crime, and corrupt institutions to American shores, people whose only contribution was adding themselves to the welfare rolls:

Editorial note: If you’re interested in discussing the many issues related to open borders, check out the Open Borders Action Group on Facebbook.

Economists want more immigration, why don’t you?

July 27, 2013 John Lee 12 Comments

A perennial assertion of open borders skeptics is that they are the voice of reason and empirics in the immigration debate, while open borders advocates are soft-headed people thinking with their hearts instead of their brains. So this humble blogger spent a Friday lunch hour in Washington, D.C. attending a Cato Institute panel titled What Economists Think About Immigration. Incidentally, the panel was broadcast on C-SPAN, and thanks to them, you can also view the full panel online.

Of the four people on stage, only one was a new face to me:

Alex Nowrasteh (moderator of the panel, Cato Institute researcher, and an Open Borders blogger)
Madeline Zavodny (panelist, chair of the Agnes Scott College economics department)
Ethan Lewis (panelist, associate professor of economics at Dartmouth, and my former econometrics professor)
Michael Clemens (panelist, Center for Global Development researcher, and the man who single-handedly changed the way I think about immigration)

Zavogny presented first, talking about high-skilled immigrants to the US and how they contribute economically to the US. I think even open borders skeptics tend to favour high-skilled immigration. Those who don’t are either unmoored from reality, or openly admit that they don’t have a hard empirical reason for their belief that high-skilled immigrants should be banned from taking good jobs. So I won’t cover Zavogny’s presentation in depth.

Clemens presented third, but similar to Zavogny, I don’t think he covered much terribly new ground in the debate (at least, that would be new to someone already familiar with the academic debate on immigration’s empirical impacts). Clemens presented a version of his double world GDP lecture, covering the usual ground: immense gains to migrants, doubling world GDP, banning “brain drain” dehumanises immigrants and doesn’t help anyone, and ending restrictions on freedom of movement may seem crazy, but crazier things have happened (see: the abolition of slavery).

Lewis, on the other hand, presented some really compelling and new material. To me, one of the new things was how strongly he feels about immigration! I suppose econometrics does not lend itself to very passionate lectures, but although I knew he studied immigration while I was a student of his, I had no inkling of the depth of his support for reducing immigration restrictions. (Full disclosure: I was also a student of his wife, Elizabeth Cascio, who supervised my senior seminar and final economics paper.) Even more new and exciting to me: Lewis presented some of his latest work, which finds that immigration has boosted the income of Americans across the board — even low-income Americans.

Perhaps the most commonly-cited harm of immigration is its impact on the wages and employment of natives. Immigration supposedly reduces wages across the board. This is a complete myth, which no economist would sign on to (at least, none that I’ve read, including prominent skeptics). There is concern among a few economists that immigration harms income and employment for low-earning natives. However, few find this result, and most that do have been subject to various criticisms: the impact they find is extremely small (the most popular estimate here would suggest that 20 years of immigration to the US resulted in a cumulative 3% decline in low-earning natives’ wages); it’s sensitive to the removal of a few data points; it doesn’t account for how capital investments react to the influx of labour; it relies on data from a period when other things driving reduction in wages, such as the decline of trade unions, could be confounding the results.

Lewis presents a slide (at roughly the 25:30 mark in the C-SPAN recording) suggesting that not only has immigration increased the wages of high-skilled natives, as you would expect — it has also increased the wages of low-skilled natives. Why does the wage data suggest this? What plausible mechanisms are there? Lewis suggests two major things:

Changes in the use of capital — firms respond to an influx of immigrants by investing less in capital than they had planned, creating jobs for low-skilled natives as well as immigrants and ameliorating the potential negative wage impacts for low-skilled natives
Immigrants compete in a different labour market than natives — immigrants whose English fluency is limited or non-existent will compete among one another for jobs, and natives emerge unscathed thanks to their English skills

Lewis presents the arguments for these mechanisms quite well, so I’d urge you to watch his talk yourself. In particular, he has a number of interesting charts backing all these points up. My understanding is he has a forthcoming paper that will fully flesh out the ideas in his presentation. My take is this is just one data point, but if you’re analytically evaluating the likely outcomes of more immigration, seeing this ought to make you revise upward your assessment of the probability that immigration helps or doesn’t harm natives. And given the existing literature, that assessment should already have been assigned a fairly high probability in the first place — certainly not the 0% chance that so often seems to be assumed in immigration debates.

Lewis wraps up his talk by urging the audience to think beyond the current policy debate in Washington, which focuses today primarily on whether to regularise the 11 million unauthorised immigrants currently living in the US. He points out that it makes absolutely no sense to ban people from migrating in the first place, and given the immense gains to the migrants, even if you don’t believe his estimates, you should be happy to enforce a tax or fee on them that captures some of those gains, to ensure all natives benefit from immigration.

Economists overwhelmingly reject popular myths that immigrants are economic harms. Yet these myths refuse to die. We no longer believe that Jews drink the blood of babies, that Chinese eat rats, or that Irish are just drunk beggars. Why do we believe that people born on the other side of an invisible line called the national border are an incredible harm to us, while people born on the other side of an invisible line demarcating a county or province are perfectly guiltless? Both types of people are as likely to “steal” our jobs and drive down our wages. But one person we call a criminal for crossing that invisible line; the other, we call a good citizen.

I can’t echo my former professor’s words enough. We need to think beyond today’s debates about immigration. The fact is, today’s debates rely on ignorant assumptions about immigration. They assume immigrants are “job thieves”. Having a debate on these terms is like arguing whether we should let more Jews in or hold back lest they start drinking our children’s blood or poisoning our wells. We’re starting from premises so utterly wrong that there’s no point having the debate.

Of course the US should have a process for legalising people who’ve lived in the US for a long period of time. If they ever did any harm by crossing an invisible line 10 or 15 or 20 years ago, as long as they aren’t committing any crimes and harming anyone today, we should live and let live. This is so basic that as Lewis says, we need to think bigger. We need to reject the myths of the past, and adopt a reality-based immigration policy — one that embraces all human beings as people with dreams and goals and potential and contributions that will enrich us all and build our communities.

Open Borders: The Case