Thursday, September 30, 2010

Selfish Reasons for Immigration

This may have replaced drug legalization as my issue of most interest. You've heard the moral, historic, and economic reasons for and the honest concerns against increasing US immigration. Now here are some selfish reasons for it:
Immigrants will solve our housing crisis. One major reason why housing prices remain in the doldrums and sales remain slack is that there are simply too many houses for sale. The National Association of Realtors reported that in July, there were 3.98 million existing homes on the market, representing a 12.5-month supply at the current pace of sales.
Here's another:
Immigrants are needed to replenish the American workforce. While the American labor force continues to grow, the rate at which it grows has been slowing down for decades. The Bureau of Labor Services projects that by 2020, the growth rate will be just 0.4 percent per year, and by 2030 just 0.3 percent per year. Some of this is attributable to baby boomers moving into retirement homes, and some is attributable to declining birth rates.
And one more:
Immigrants make the economy better. Not only does the San Francisco Fed paper—written, appropriately, by an Italian economist, Giovanni Peri—argue that immigrants don't hurt the economy, it actually makes the case that immigrants are putting money in the pockets of native-born workers. Specifically, it says that "total immigration to the United States from 1990 to 2007 was associated with a 6.6 percent to 9.9 percent increase in real income per worker."
All of those talking about the need for a second stimulus should take my intro economics class. The best way to increase demand is to increase the number of demanders.

Related: In France at least, an increase in immigrants does not mean an increase in crime.


  1. I hope the policy makers reads this through and relax the VISA cap ... :)

    One question : What about the competent immigrants who are ready to work for lesser money & pulling the jobs from citizens ?


  2. Separate citizenship from work visas (and progeny of those on work visas) and you've got my attention. Tighten up the welfare state eligibility (minimum wage, SS, medicare, etc.) and be reasonably selective about who gets work visas, and you've got my vote.

  3. Kaushik,

    I think the "pulling the jobs from citizens" is missing a key part of job creation. Jobs exist when someone is willing to do work for the price another is willing to pay them. That means there is no fixed number of jobs. In fact, I've got 30 jobs in my house right now, but probably no one willing to do it for the wage.

    There is certainly a downward pressure on wages because of labor competition, but there is not a "taking of jobs".

    Free Spirit,

    I'm curious, what would use to "select" people for work visas?

  4. Harrison,

    I beg to differ on the same ... suppose there is a position for which the citizen will work for 60$ per hour but the immigrant is ready to work for 45$ per hour wage. In this case either citizen will have to leave the position or ready to work for lower wage to compete. If he lowers his wage then he needs to lower his living standard to keep both the ends meet which is for sure better than no work …!!

    Now suppose there is no immigrant to fill the shoes then the business will have to hire higher wage people with no other option. left. But then this will make the business less competitive in global landscape , which I guess could be countered with internal demand/ market.

    Now the most awkward part of the discussion ... I am saying against the immigrant although I don't work in my home country (in short an immigrant)

  5. I think we agree here Kaushik. Low skilled immigrants decreases wages for other low skilled workers. However they also decrease prices for the products they help produce.

    Thanks for your honesty and ability to remove yourself from something that is clearly personal to you.


You are the reason why I do not write privately. I would love to hear your thoughts, whether you agree or not.