America’s debate over immigration policy, rightly or wrongly, is often reduced to a single question: What’s the economic upshot?
Some of those looking to slow — or at least better control — the flow of immigrants into the United States point out that the newcomers often are poorer, less educated and more likely to rely on public assistance. There also are questions about whether unauthorized immigrants pay their share of taxes, and about whether most of their wages flow not into the U.S. economy but back to their homelands.
Robert Lawson, an economics professor at Southern Methodist University’s Cox School of Business, takes another view.
Lawson and four colleagues published a paper arguing that immigrants have, overall, a positive effect on the nation’s institutions and policies and a “meaningful, if not large, impact on economic growth.” He also argues that immigrants actually make America more American.
Lawson, who holds the Jerome M. Fullinwider endowed centennial chair in economic freedom at SMU’s O’Neil Center for Global Markets and Freedom, talked about his findings in an interview last week.
You and your colleagues found a small but positive gain for the incomes of native-born Americans that can be attributed to the presence of immigrants. How do new immigrants make it possible for Americans to do better financially?
The big evidence from all the papers, almost all the papers that have been written by academics, show that there are net gains to Americans from immigrants. And the mechanism is primarily through specialization. I mean, I actually still mow my own lawn, but I’m a relatively well-paid SMU professor, and to a certain extent, it’s kind of inefficient for me to spend a couple of hours of my week mowing my own lawn. If we had more immigrants, I might be able to hire someone to mow my lawn. One way that immigrants help native-born Americans is they free up time that we could spend doing more valuable things.
There is a negative side for Americans who are at the lowest end of the economic rung and may have the fewest marketable skills. Indeed. The net gain is positive, but there are certain segments of the American population, or American workforce, who probably lose. And it’s mostly going to be at the end of the income distribution. Low-income Americans, less-skilled Americans ... they’re in direct competition with immigrants for those lawn-mowing jobs and things of that sort.
There’s a negative effect there. Although I must say, the effect is vanishingly small. The last number I saw, it was something along the lines of 0.1 percent lower income for low-income Americans over a 20-year period. To be kind of blunt about it, that’s like a cup of coffee a day. It is a reduction in income for low-income Americans, but it’s a really tiny one in comparison to the gains to the other Americans.
And we should also count the immigrants. The immigrants themselves get massive gains, the mere act of moving from Mexico to the United States, or from Haiti to the United States. That mere act makes that Haitian, eight, 10, 20 times better off. So there’s a little bit of pain for some Americans, a little bit of gain for most Americans, and there’s a lot of benefit for the immigrants themselves.
One of the things you found was that immigrants tend to move from countries with fewer social services and benefits to those with more.
Well, not necessarily. What we find is that people are attracted to economic opportunity, and the countries that have a lot of economic opportunity can be billed the rich countries, let’s call them. They also tend to provide social services. But I think what we find in our analysis is that it’s not so much the social services that are attracting them as much as the incomes, the jobs.
You sort of have to disentangle the attraction. Is the attraction ... a welfare magnet, or is it an economic growth magnet? I think the evidence is more on that [latter] side. They’re more interested in job opportunities and incomes than they are in the dole, if you want to use that term.
And even if there were a welfare magnet, the rising percentages of immigrants causes that outlet to shrink.
Yes, indeed. The big debate that’s going on right now in the academic literature is: How are immigrants going to affect the policies of the country that is taking them in? It’s a little bit political to say it this way, but the narrative from some folks will be, “Well, they’re gonna import their socialism with them.” You know, we are in Texas and we have a lot of capitalism-loving people and they’re worried about immigrants. They think they’re coming from Venezuela. ... The People’s Republic of Venezuela isn’t as free, so are they going to bring their crazy, bad ideas with them?
Well, what we find is, and I think this should not be surprising ... we find the exact opposite. In fact, countries that absorb the most immigrants, their policies get more free-market — they get more capitalist. I mean, after all, they voted with their feet. They left Venezuela ... they left these places. Presumably they weren’t looking for another Venezuela to go to. So to me, it’s not a surprising result, but it’s a result we find. And I think it’s comforting for people who are worried about [immigrants] dramatically changing the American way.
This Q&A is condensed from a recent episode of “Think” on KERA-FM (90.1), hosted by Krys Boyd, and is part of a partnership between The Dallas Morning News and KERA. You can listen to the full episode at kera.org/think. Boyd can be contacted at think@kera.org. Reach Lawson at rlawson@cox.smu.edu.
