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The economics of migration

This is a very long (3800 words!) and thorough article laying out the argument for allowing more legal immigration written by the Economist Jonathan Portes.

Professor Jonathan Portes

This is just one section, but a critical one:

immigration’s (non)impact on jobs and wages

Public and policy concern in the United States and other developed countries tends, for obvious reasons, to focus on the impacts on existing residents and especially the distributional impacts of immigration—the potential negative impacts on employment and wages for low-skilled workers. Many non-economists (and even some economists) simply assert as an article of faith that such effects must exist—usually suggesting that it’s a matter of “supply and demand.”

But this is very bad economics. It’s entirely true that immigrants add to labor supply. Indeed, it’s even true to say that immigrants “take our jobs” (I work and live in London, and I’m sure that I, like many UK-born economists, have at some point failed to get a job because my prospective employer preferred to hire an immigrant). But the point is that immigrants (directly or indirectly) add to labor demand as well as labor supply; they earn money and spend it.

Ignoring this effect, as many do, is what economists call the “lump of labor fallacy”—the idea that there are only a certain number of jobs to go around, so that if an immigrant to the United States (or an old person or a woman) takes one, then an American (or a young person or a man) must lose out. But while an immigrant may “take” one job from an American worker directly, they may also “create” one job for American workers. Similarly, wages for American workers might rise or fall. So the only way to find out what immigration does to jobs and wages is to look at the data.

The most famous research evidence on this in the developed world comes from David Card’s 1990 study of the Mariel boatlift. The 1980 movement of Cuban refugees to the United States represented a huge “supply shock” of mostly low-skilled immigrants into Miami, Florida’s labor market. Card found, surprisingly, that the impact on native wages was very small. This result was so controversial that economists are still arguing about it, nearly 30 years after it was published, with the leading U.S. immigration economist George Borjas disputing his conclusions (although the consensus, as outlined by development economist Michael A. Clemens for Vox in 2017, remains that Card’s original result stands). More broadly, a huge body of subsequent research, both in the United States and elsewhere, has largely supported Card’s conclusions (reviewed, for example, in a 2011 NBER working paper by economists Sari Pekkala Kerr and William R. Kerr). The consensus is that negative impacts of migration for native workers in developed countries are, if they exist at all, relatively small and short-lived.

and it concludes:

Immigration is a rare example of a topic where economists and other social scientists across the political spectrum broadly agree, and we should stand our ground.

On this, I could not agree more.  We need economists to stand their ground and speak the truth on immigration.

Please read the entire article.