This year's immigration "debate" revealed once again that, with the exception of economists who actually study immigration, most economists don't know anything about the topic and don't even think that the basics of economics (e.g., supply and demand, ceteris paribus, etc.) apply to immigration.
Harvard immigration economist George J. Borjas will be publishing his magnum opus next June:
Harvard immigration economist George J. Borjas will be publishing his magnum opus next June:
Immigration Economics
George J. Borjas
Millions of people—nearly 3 percent of the world’s population—no longer live in the country where they were born. Every day, migrants enter not only the United States but also developed countries without much of a history of immigration. Some of these nations have switched in a short span of time from being the source of immigrants to being a destination for them. International migration is today a central subject of research in modern labor economics, which seeks to put into perspective and explain this historic demographic transformation.
Immigration Economics synthesizes the theories, models, and econometric methods used to identify the causes and consequences of international labor flows. Economist George Borjas lays out with clarity and rigor a full spectrum of topics, including migrant worker selection and assimilation, the impact of immigration on labor markets and worker wages, and the economic benefits and losses that result from immigration.
Two important themes emerge: First, immigration has distributional consequences: some people gain, but some people lose. Second, immigrants are rational economic agents who attempt to do the best they can with the resources they have, and the same holds true for native workers of the countries that receive migrants. This straightforward behavioral proposition, Borjas argues, has crucial implications for how economists and policymakers should frame contemporary debates over immigration.
Borjas didn't exactly cover himself with glory in the Richwine brouhaha. See here. Also, the fact that immigration is being discussed as a purely economic issue is a great error and a great victory for liberals. (Short-term) economic effects are one of the least important things about immigration.
ReplyDeleteBorjas is an economist, so he's going to talk about immigration in economic terms. Ed West, Peter Hitchens, Steve, and others can make the non-economic case.
ReplyDeleteDave Pinsen: Borjas is an economist, so he's going to talk about immigration in economic terms.
ReplyDeleteThat's true and a perfectly valid point. Though there are also economic effects of being eaten by a bear, and yet sane commentators rarely focus on that.
Peter Turchin, a historian rather than an economist, gives due emphasis to immigration in reviewing the dynamics of inequality in America over the last 200 years, even citing Borjas.
ReplyDelete"One of the most important forces affecting the labour supply in the US has been immigration, and it turns out that immigration, as measured by the proportion of the population who were born abroad, has changed in a cyclical manner just like inequality. In fact, the periods of high immigration coincided with the periods of stagnating wages. The Great Compression, meanwhile, unfolded under a low-immigration regime. This tallies with work by the Harvard economist George Borjas, who argues that immigration plays an important role in depressing wages, especially for those unskilled workers who compete most directly with new arrivals."
http://www.aeonmagazine.com/living-together/peter-turchin-wealth-poverty/
He's on the liberal side, only from an older era when they focused on political-economic questions, rather than multiculturalism, sexual harassment, etc.
Why don't more people write about the relevant history?
Some (on both left and right) are plain old incurious, nothing we can do about that.
The left has its sacred cows about today being an era of awesome progress, and opening the gates to more immigrants would only make us that much awesomer. Hence their brain would explode to learn that we're merely reproducing the Victorian, Dickensian Gilded Age.
The right feels the same, only the other way around. It despises what it sees unfolding today, but they have sacred cows about the past -- especially any time before 1960. They like the 1950s, but what they don't realize is that those days were, politically and economically, the mirror image of the Gilded Age.
I'm not clear if they think that all periods before 1960 are equally taboo to criticize, or if they're already committed to the Victorian / Gilded Age in particular as being one of those heights of civilization.
But in political and economic terms, the Gilded Age would have seemed like bizarro world to an observer from the 1950s. Immigrant numbers exploding, mawkish tripe about "your poor, your tired, your huddled masses" being enshrined as high patriotic art, red light districts blighting every major city with booze and brothels...
That was the context behind Pottersville as dystopia in It's a Wonderful Life -- if it weren't for George Bailey, mid-century America would still be mired in the turn-of-the-century hellhole. (Or so says a historian I just read on the subject.)
...all this being a long-winded plea for us to take a greater and honest interest in the past, to see what it might tell us about where we're headed today.
agnostic,
ReplyDeleteIf you want to read someone who has a great interest in the past, I suggest Pat Buchanan. He puts out two columns per week and writes a new book every three years or so. He has a good way of taking issues from today and showing how similar they are to issues from the past. He writes in a manner that makes it seem as though he lived through some of that history too. He is very interesting. If you enjoy iSteve, you'd probably enjoy him.
The more I study economists - as opposed to economics - I keep coming to the same conclusion, namely that most professional economists know even less about their own subject than they know about any other subject.
ReplyDeleteHow else come the ad-nauseam repeated assertion that drips from the mouths of a whole rabble of economists, like foam from the mouth of a rabid dog, that the law of supply and demand somehow has no application whenever the labor market and 'unrestricted immigration' is concerned?
A blatant falsehood piled on to a blatant absurdity one would charitably think, the unkinder explanation being that the economists concerned are dumber than IQ 70s.
By way of analogy, denying the law of supply and demand is rather like a mathematician denying the law of addition, ie 1+1=2, and thus denying the whole cumulative superstructure, (Einstein, Newton, Gauss and the rest), based upon that most basic, basic axiom, the deepest footing on which all the rest stands. To stretch the analogy further, it's rather like a professor of literature denying the existence of the alphabet, or even a human being, any human being, denying the existence of the necessity of food and water in keeping him alive.
"Oh!", "It's not as simple as that!" I here the liars scream.
"Lump of labor", lump of labor!"
"There, you simply *don't understand it*", "I'll scream it agin 'lump of labor' ".
Now, that's the magic the ecomomists pull out of their asses, something called 'lump of labor' which you 'simply do not understand'.
Never mind that this catchphrase was devised to describe something utterly, utterly different that the economists/fools/liars are trying to impute. Never mind the fact that it's just a rotten piece of journalese, and not serious analyis or 'theory'.
Of course, Steve Sailer is an expert economist.
ReplyDeleteOh wait, he's actually an expert in.... well, nothing. That doesn't stop him though, which I admire.
Borjas is right but he like others tend to split the debate up in current immigration benefits the immigrants and the employees on the one hand and everybody else on the other hand. Or rather those people in direct competition with immigrants.
ReplyDeleteHowever as a result of this immigration we do get goods at a cheaper prices which is raising the living standard all things being equal.
I'm not saying this justifies immigration. In fact I agree with restrictionist but I don't get why they have to pretend that people's living standards aren't raised by cheap labor through cheaper prices. That would be an honest evaluation of immigration and you can still say that I prefer the well being of the lower rung in society(underclass whites, blacks, latinos) to lower prices.
Personally I wanted to spearhead the restrictionist camp I would appeal to patriotism and practical matters. But I would also strike a deal so that employers would have less regulations that would allow them a high degree of competitiveness. In return we get restrictions in immigrations. While I understand that most restrictionists don't have much sympathy for big capital we should be pragmatic and strike such a deal.
"Lump of labor", lump of labor!"
ReplyDelete"There, you simply *don't understand it*", "I'll scream it agin 'lump of labor' ".
Now, that's the magic the ecomomists pull out of their asses, something called 'lump of labor' which you 'simply do not understand'.
Never mind that this catchphrase was devised to describe something utterly, utterly different that the economists/fools/liars are trying to impute.
See also, "comparative advantage". Always seen in the forms of "obviously you don't understand comparative advantage", or "never herd of compairtiv advantij, moron!?!", depending on the tone of the venue.
"Lump of labor" and "comparative advantage" are straightforward ideas, easily grasped, encountered and digested early on by anybody paying any attention to the subject at all. That being so, what does it tell you about people when they perennially, huffily suggest that such basic things must have escaped the reader's notice, or that they are concepts so thorny and abstruse, that they have escaped his comprehension? Nothing good, that's for sure.
Does it matter what Borjas has to say about the economic effects of immigration on the country? Our "elite" rulers have already decided to continue flooding the country with low-skilled, Third World immigrants will little or no cultural similarity to Americans. Let us Tax Slaves pay for the benefits that the Rulers enjoy....lowered wages, higher unemployment among US citizens, closing emergency medical centers, lowered academic requirements in the public school system, rising violent crime rates involving Third World males....
ReplyDelete"Oh wait, he's actually an expert in.... well, nothing. That doesn't stop him though, which I admire."
ReplyDeleteOne of the finest traditions in the English-speaking world, apparently extreme with respect to much of the world, is the tradition of the common thinking man seeing beyond the bounds of "the experts". The Wright brothers versus Langley phenomena.
Perhaps experts tend to form "fields" that come with built in assumptions, what T.S. Kuhn called the "paradigm" accepted by the field. It would seem that having people outside the paradigm, if you will, is a net plus for a civilization. More paradigm shifts and all that.
"However as a result of this immigration we do get goods at a cheaper prices which is raising the living standard all things being equal."
ReplyDeleteI just noticed this in the wikipedia article on Adam Smith:
"Alfred Marshall criticized Smith's definition of economy on several points. He argued that man should be equally important as money... there must be an emphasis on human welfare, instead of just wealth."
Can you measure human welfare just by money and cheaper prices? The basic condition and stress of the society one lives in has to be factored into things somewhere. It's not clear that the "GNP"-type single big Number so favored by economists captures all of this.
That is, what if all other things aren't equal? How is that accounted for? Do the economic numbers factor in living where the knockout game is popular?
"with the exception of economists who actually study immigration, most economists don't know anything about the topic"
ReplyDeleteWell, duh, of course they don't. How would you expect them to know about anything without studying it? All academic fields are like this - it takes all your effort to stay up to speed in your own sub-field, how and why are you going to find the time to develop expertise in some other sub-field?
"and don't even think that the basics of economics (e.g., supply and demand, ceteris paribus, etc.) apply to immigration."
The basics of microeconomics in fact don't apply to immigration, because ceteris isn't paribus. You're not just changing the supply of labor, you're also changing the demand for everything at the same time, and that's not even getting into culture clash effects. When everything is changing all over the place at the same time, you're now talking about macroeconomics where the ordinary law of supply and demand doesn't apply. In fact (as you may have noticed since 2007 or so) macro as a whole is kind of in a state of shambles at the time, so economists from other sub-fields really don't have a leg up on understanding immigration over any bright person who reads the papers.
All this guff about mass immigration and 'low prices' for consumers.
ReplyDeleteA wiser man than me criticizing Britain's disgusting New Labour's unilateral abolition of immigration controls put it thus
"Yep, the current idea these days is that the way to make a country richer is by importing a shit-load of poor people".
That phrase, in a nutshell, for me at least, pulled the rug from under the immigrationists' feet in a way no amount of pseudo-intellectualizing with 'complex' theory ever could. Basically it was the killer punch-line every aphorism hunting wordsmith is always hunting for. Undeniably true, curt, short, sharp, cutting and straight to the point.
Q/. Why is India poor?
ReplyDeleteA/. Because it's got a lot of poor people.
Really. It really is as simple as that. India is poor because it is chock-full of millions of paupers. Ignore all the over-intellectualizing bullshit generalizations from econmists both form the right and the left. Ignore all the guff about 'restrictions on the market' or even 'lack of investment' or 'underdevelopment' or 'lack of education' or 'bad institutions' etc etc etc. India is poor because it's full of poor people a tautology I know for sure, but a tautology of enormous explaining power.
Unfortunately, the tendency is to think of the abstract label 'India' meaning some sort of geographical political entity that you can point to on a map and read about. All well and good, but in actual fact India means a shit-load of paupers, simple as that, a shit-load or paupers without a pot to piss in.
Millions upon milions of them, there numbers are legion. They produce next to nothing - and they consume next to nothing. Therefor the general rationalization is that 'India is poor'.
Somehow a lot of 'clever' people think that it's a jolly wheeze to import millions upon millions of paupers into the west on the grounds that millions upon millions of paupers somehow, in themselves, equals 'wealth'. 'Wealth' not just for the paupers but for the paupers' host, strangely enough.
Believe it or not, this rank nonsense that a child would dismiss as being pure shit is the orhtodoxy amongst 'intelligent' men and more scarily and tragically of the men who hold all the political power. It is being imposed and it will be imposed even more some.
Really. This is why I slag off economists. If a doctor recommended that the way to healthiness was to cot off both your legs with a dirty knife, then he'd make more sense.
"Can you measure human welfare just by money and cheaper prices? The basic condition and stress of the society one lives in has to be factored into things somewhere. It's not clear that the "GNP"-type single big Number so favored by economists captures all of this."
ReplyDeleteGDP does not capture this at all nor does it capture many other things that are important.
I don't disagree with anything you said. My point was that when we discuss immigration we should acknowledge that it is not merely employers and immigrants that benefit. Living standards rise when we get cheaper services and goods. The task of economists/thinkers on both sides is to display fully the consequences(cost/benefit) on both sides of the equation and so we can make an informed choice. Ignoring the benefits of cheaper goods and services is as disingenuous as ignoring social/fiscal/cultural costs of immigration.
But in political and economic terms, the Gilded Age would have seemed like bizarro world to an observer from the 1950s. Immigrant numbers exploding, mawkish tripe about "your poor, your tired, your huddled masses" being enshrined as high patriotic art, red light districts blighting every major city with booze and brothels...
ReplyDeleteYou have a point there, folks like Paul Ryan would be shocked about how the days of a more freer market were in fact they did things that some real conservative catholics and many evangelicals consider immoral like the brothels. In fact FDR's New Deal era was a period when brothels were outlawed. People started to have sex with their girlfriend and married the girlfriend if she got pregnant while in the 19th century or early 20th young men went to brothels because their girl friends had to be sexually pure while they didn't.
Well, the right made the mistake on going after the illegal immigrants from rural parts of Mexico instead of the employers. The employers should have been Simon La Greedy at the beginning and even the left would have opposed businesses interest driving down wages to get cheap labor.
ReplyDeleteSam: Ignoring the benefits of cheaper goods and services is as disingenuous as ignoring social/fiscal/cultural costs of immigration.
ReplyDeleteUnfortunately, the economic cost of "cheaper" goods and services isn't accurately calculated, either. "Cheaper" ain't always cheaper; in a welfare state, "cheaper" can be pretty damned dear. I concede that this may be impossible to explain to someone who apparently thinks "fiscal" has to do with cultural intangibles, not quantifiable economic factors.
Personally I wanted to spearhead the restrictionist camp I would appeal to patriotism and practical matters. But I would also strike a deal so that employers would have less regulations that would allow them a high degree of competitiveness. In return we get restrictions in immigrations. While I understand that most restrictionists don't have much sympathy for big capital we should be pragmatic and strike such a deal.
ReplyDeleteThey already do that its called the underground economy where they don't do workers compensation, no regulations, no overtime and don't have to pay the minimum wage. The right has a fallacy the states with the highest illegal immigration are not always high regulated states some are low regulated states like Texas who is number 2 in total numbers almost 2 million.
11/17/13, 6:57 AM
This is where the political right is wrong on wages and illegal immigration. The food industry can have minium wage as low as 2.14 per hr since waitress and waiters get tips and they are supposed to make out the different between 2.14 and 7.26 but they don't if the person is not getting tips. In fact both California and Texas have the same percentage of illegal immigrants employed in the Leisure and Hospitality industry. California pays 8 per hr plus tips while Texas pays 2.14 plus tips for restaurant tip jobs. Conservatives need to abandon the cheap labor philosphy of Herman Cain on this issue.
ReplyDelete