Thursday, September 22, 2011

When thinking about immigration, remember the migrants.

So says economist Tim Harford. The whole post is worth reading, but the take-away point is:

A recent survey by the economist Michael Clemens, of the Center for Global Development, points out that although the question is largely ignored, any reasonable estimate of the economic gains from freer migration would dwarf that of the gains from, say, freer trade – if we include the welfare of the migrants themselves.
This paper by Clemens argues that by placing "tightly binding constraints on emigration from poor countries," we're walking by "trillion-dollar bills on the sidewalk." He sums up the paper in this article in the Guardian, saying:
The reason migration packs such economic punch is both simple and mysterious: a worker's economic productivity depends much more on location than skill. A taxi driver in Ethiopia's capital, no matter how talented and industrious, cannot earn more than a few thousand dollars a year. The same person doing the same job in New York City can easily earn $35,000 a year. The reason people will pay him that much is that his driving adds more than $35,000 of value to the New York economy, more value than his actions can add to the Ethiopian economy.


rcocean said...

Wow, you the mean pro-open borders, pro-free trade, pro-outsourcing, 'hurrah for globalization' Economist magazine found a study that showed immigration is just great?

Shocking. Of course, if we just want to make the greatest number of people feel good why don't we send everyone in the Africa a check for $1,000. Sure, a few American taxpayers would be unhappy but overall - increased happiness.

John Althouse Cohen said...

Sorry, I inadvertently capitalized the common noun "economist" in referring to "economist Tim Harford." I've fixed it. This post doesn't link to The Economist.

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