A startling new look at the impact of immigrant workers

A new book about migration stands many of the canards of the current immigration debate on their head.  It comprehensively makes the point immigration is unpopular in rich countries because people overestimate the costs of immigration and underestimate the benefits.


Most startling to me is the authors computation that if rich countries allowed a 3% increase in migration to expand their work force the world as a whole would be richer by $356 billion dollars.  Completely opening borders so labor could flow freely from poor countries to rich countries would add $39 Trillion to the world economy over 25 years.  That is more than 500 times what the rich world currently spends on foreign aid in a year.


This multiplying effect is a result of the fact wages in the rich world are a fortune by poor country standards, and since migratory workers tend to send large chunks of their earnings home to families, those remittances boost the poor country economy increasing their ability to become consumers of rich world products.  (Unlike foreign aide, those remittances go to the people of the country instead of getting poured into the pockets of the government elite, or wasted in huge nonsense government projects)


Regarding highly skilled workers migrating to rich countries the authors note while "brain drain" hurts poor countries to some extent, it also motivates people to increase skills, and then some stay at home.  Highly skilled immigrants also may start businesses in destination countries that increase the rich country employment base, so in the end brain drain can be a boost to local economies at both ends of the migration.


The authors review studies about how much immigrants displace native low skill workers and find the studies show the fear greatly exceeds the reality, the effect is relatively negligible (not to say the effect is not very real for some native workers).  Migrant workers in fact sometimes create opportunities for native workers by starting businesses, or freeing up one spouse so both spouses can work.  


One point in the book that particularly caught my attention was the authors point that migrant workers usually prefer to come when their services are wanted and go home when they are not.
That point brought to my mind the Bracero program we used to have in California where large numbers of people were allowed to come to the country each year to work legally in low-skilled jobs.  They returned home when they were not working. As I recall that program was killed in a burst of anti-immigrant fervor some years ago.   I wonder if a large part of our immigration problem now is because eliminating that option to come, work legally, then go home and come back again as work becomes available means people are more likely to try to smuggle in their family and put down roots so they don't have to deal with the enormous risks and dangers of border crossings.


The book is "Exceptional People:  How Migration Shaped our World and Will Define Our Future" reviewed by the Economist (May 28, 2011, p.87)