Economists on immigration

Immigration has been in the news quite a bit recently, as certain political factions (we are so fair and balanced that we won’t say which ones) are looking to score some cheap points at the expense of immigrants. They will even go so far as to deploy the National Guard at our border with Mexico, since those Guard folks have more or less been sitting around with nothing to do for the last three years.

Alex Tabarrok, who blogs at Marginal Revolution, is attempting to inject some facts into the debate. He is basically libertarian/conservative himself, but there is consensus among economists from either side of the political spectrum on the basic realities of immigration, and he has written an open letter to the President and Congress urging them to take these realties into account. It’s been signed by professional social scientists of all political persuasions (including Brad DeLong on the left); if there are any experts reading, they are welcome to sign it themselves.

Dear President George W. Bush and All Members of Congress:

People from around the world are drawn to America for its promise of freedom and opportunity. That promise has been fulfilled for the tens of millions of immigrants who came here in the twentieth century.

Throughout our history as an immigrant nation, those who are already here worry about the impact of newcomers. Yet, over time, immigrants have become part of a richer America, richer both economically and culturally. The current debate over immigration is a healthy part of a democratic society, but as economists and other social scientists we are concerned that some of the fundamental economics of immigration are too often obscured by misguided commentary.

Overall, immigration has been a net gain for existing American citizens, though a modest one in proportion to the size of our 13 trillion-dollar economy.

Immigrants do not take American jobs. The American economy can create as many jobs as there are workers willing to work so long as labor markets remain free, flexible and open to all workers on an equal basis.

Immigration in recent decades of low-skilled workers may have lowered the wages of domestic low-skilled workers, but the effect is likely to be small, with estimates of wage reductions for high-school dropouts ranging from eight percent to as little as zero percent.

While a small percentage of native-born Americans may be harmed by immigration, vastly more Americans benefit from the contributions that immigrants make to our economy, including lower consumer prices. As with trade in goods and services, the gains from immigration outweigh the losses. The effect of all immigration on low-skilled workers is very likely positive as many immigrants bring skills, capital and entrepreneurship to the American economy.

Legitimate concerns about the impact of immigration on the poorest Americans should not be addressed by penalizing even poorer immigrants. Instead, we should promote policies, such as improving our education system that enables Americans to be more productive with high-wage skills.

We must not forget that the gains to immigrants from coming to the United States are immense. Immigration is the greatest anti-poverty program ever devised. The American dream is a reality for many immigrants who not only increase their own living standards but who also send billions of dollars of their money back to their families in their home countries—a form of truly effective foreign aid..

America is a generous and open country and these qualities make America a beacon to the world. We should not let exaggerated fears dim that beacon.