Common ground on immigration

Nothing seems to generate as much controversy as immigration. My post the other day in support of Chris Berg’s call for freeing up immigration laws is a good example. But what is interesting to me is how it seems to cut across usual right-wing and left-wing divides.

The right-wing case against immigration has to do with rights. Australia supposedly has a right to self-interest and to pick and choose who gets to come here based on self-interest. That self-interest often includes getting the right cultural mix. The left-wing case against immigration is similar. It often has to do with jobs and the protection of them by erecting immigration barriers. Sometimes it includes housing and even the environment in that mix. In each case, there is a presumption that nations should operate according to a group interest and choose who gets to join and enjoy the fruits of the group.

Here is how I see the case for free migration. The presumption that immigrants are coming here and getting an automatic upgrade in their wealth seems spurious. For the migrants we are consistently blocking, they do not end up in the higher echelons of society. Now, I should note here that for those against immigration, this is part of the point. We have a set of redistributive policies in place and so recent immigrants are beneficiaries of that. The right wing response is perhaps to suggest that those policies are the problem. But that is not the way I see it. As a member of the higher income echelon of society, if I am going to be contributing towards redistribution, I don’t care whether the beneficiaries are Australians or not. But I do care that they are living nearer to me as that is the way we conveniently divide our responsibilities around the globe. If there are more people living near me, so be it.

But the key issue is the reason for migration. Paul Romer has usefully emphasised the diversity of rules — including good and bad ones — that distinguish countries. What people are migrating for are a preference for Australia’s set of rules — born and evolved out of our history. Those rules are political as well as economic and migrants might place weight on each. Some of those economic rules give immediate benefits but, in reality, my guess it is the prospective benefits of the rules that are spurring migration.

When we do not have free migration, we stop people being able to match different rules to their preferences. Personally, if someone in Sri Lanka prefers our rules, why should they be forced into convincing everyone else around them to adopt them rather than just moving? The problem is that we make that extremely costly. That creates two things. First, there is scope for brokers to expropriate and prey on would be migrants. Secondly, there is no legitimate route for information to properly assess that our rules are the rules you really want. That leads to distortions and potentially to disappointment and hardship. This serves no one.

This lead naturally to the counter that our rules are not fixed and having migrants will cause them to change. To this I say, so what? For starters, if self-selection is working, those changes are hardly likely to be significant. However, it is also unclear that such changes would be bad. Are our rules optimal for us? They can’t be for everyone and this is just another force for evolution

If we changed our starting point to recognising that Australia’s rules were good and having others being able to live by them was a compliment rather than a threat, this could lead to a more sensible set of outcomes. I suspect the right-wing advocates for free migration would not agree, but I see an active government role in brokering and providing information to assist migrants make decisions. I also see them as playing a role in freeing up migration across all countries. After all, the thicker the market for rules, the better it will operate. And I respect the notion that that market will be imperfect and distortionary until there is a global policy. That is perhaps the only reason for caution on unfettered migration but that does not mean we could not move much further on this.

In the end, I see migration from poorer countries to Australia as no more of a threat to us than Toorak is threatened by people choosing to move there from Fitzroy (or Sydney). Yes, migrants might enjoy and even congest public goods provided in each case but the freedom to vote with your feet for rules that work for you is something we should not impede in the name of group self-interest.

5 thoughts on “Common ground on immigration”

  1. Where is the issue with our existing policies? We are taking records amounts of migrants. Haven’t the strong policies on ‘queue jumpers’ help build support for the migration system and, from a political viewpoint, allow us to take more migrants that otherwise? Compare the current environment with the rancor that was created in the 80s after Blainey’s speeches, or in the 90s through Hansonism.
    A precipitous change simply risks undermining the support for our relatively liberal system. To make such a change I’d want some pretty clear evidence on how these risks would be mitigated. Where is the modern example of a country maintaining and benefiting from completely free migration?


  2. Matt C.,
    You have an excellent point. I was chatting about this to a taxi driver the other day, who grew up in Hargeisa, in what is now  Somaliland. His view flawed me: he was a died-in-the-wool fan of both Howard’s and Rudd’s stance on refugees, saying that his entire family migrated during Howard’s time. “Howard was all bark”, he could be heard thinking “the Somalis, the Eritreans, the Sudanese—most arrived under Howard”.
    I think the difference of views between Profs. Gans & Clarke can be more or less put down to differing views on the role of economists: Gans, that economists’ advice should aim to increase aggregate welfare, and Clarke, that the policy of the state should maximise the welfare of its subjects. Of course both views have merit.
    The real danger for economists who take the “improve the welfare of the most” view is that they risk looking like Jeffrey Sachs—the Richard Branson of economists (love me, please!). The fact is that national-interest views will win, every single time.


  3. Shouldn’t the point in this discussion be that these people are human, and as such deserve the same moral care we afford any neighbor? Why should they not be entitled to the same ‘riches’ that we have (because of the luck of where we have been born)? Broadly speaking a kind of moral cosmopolitanism.
    Taking that position it seems to me there are two important roles for economists:
    i) To inform the public discussion on the economic effects of immigration. E.g. taxes, unemployment etc. (Of course the caveat should always be that there is more to life than goods and services!)
    ii) What influence will different government policies have on the number of people arriving by boat? I take this as an important question because people can face death or harm travelling by boat. I suspect there are so many information problems that the effect of various government policies on the number of boat arrivals, all else equal, is virtually nonexistent.


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