Saturday, December 01, 2018

Open Borders

Fears of the US being overrun with immigrants should it liberalized immigration laws seem overstated.

About one in five potential migrants — or about 147 million adults worldwide — name the US as their desired future residence. But how many would actually show up even with open borders?

 Consider residents of Puerto Rico, who can freely move to the mainland United States because they are US citizens. As economist George Borjas points out the average construction worker in his thirties earns $23,000 a year in Puerto Rico vs. $43,000 in the continental United States. Moving from Puerto Rico to the continental United States increases lifetime earnings by a quarter of a million dollars, while the actual cost of moving is a tenth or less than that. More than 3 million people live in Puerto Rico, but fewer than 84,000 migrated to the continental US in 2014. This is especially surprising because a Pew Research Center survey over the same time period found that 89 percent of Puerto Ricans “were dissatisfied with the way things were going on the island.”

Or consider an example given by The Economist in July 2017: migration within the European Union. 1 percent of Greeks have moved to Germany since the 2010 Greek economic crisis, even though wages in Germany are twice as high as in Greece. Because both countries are within the European Union, barriers to migration are minimal. But the low migration rate suggests that the psychological and social costs of moving are potent and large. Different culture, different languages were the reason, perhaps.

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