Liberalising immigration would double the world's income overnight

A new paper from NBER suggests that a 116% increase in wages could result.

New Statesman

The Washington Post's Dylan Matthews reports on a new paper from the (US) National Bureau of Economic Research (£), which examines what would happen if all immigration restrictions were dropped.

Matthews summarises:

[University of Wisconsin’s John Keenan] builds a model that assumes that in the absence of restrictions, people will try to maximize income while still feeling some attachment to their native countries, and so some but not all workers will move to where their wages will be highest. He estimates that fully eliminating immigration restrictions worldwide would effectively double the world’s labor supply. This, unsurprisingly, leads to enormous economic growth, such that typical workers in developing countries would see annual wages more than double, from an average of $8,903 today to $19,272 with open borders. That is, the typical worker in the third world would end up making about double the individual poverty line in the United States today. Certain countries have even more astounding results; the typical Nigerian would see gains of $21,940.

The reasoning is simple; if people only move when they would increase their income, then liberalising migration can never make the world, as a whole, worse off.

Of course, the problem is that, as Keenan makes clear, the people who gain the most from those changes are the ones who have the least say in whether or not they actually occur:

Liberal immigration policies are politically unpopular. To a large extent, this is because the beneficiaries of these policies are not allowed to vote. It is also true, however, that the enormous benefits associated with open borders have not received much attention in the economics literature. Economists are generally enthusiastic about free trade. But if free movement of goods is important, then surely free movement of people is even more important.

Time for those places which do find immigration politically acceptable to have the power to push for it, maybe?

14 comments

JimmyDunn's picture

So when I work for fifty years from fifteen to sixty five paying National Insurance contributions and tax on my meagre earnings it is OK for people from the likes of Somalia who often can contribute nothing to this country to flood in and be given even more benifits than I could ever recieve..Often they are so poorly educated they can hardly speak english or read and write.. Because they often come from a country that brutilises people they have completely different ideas of what we see as right and wrong. They know that there is no real punishment for crimes in this weak country so they Rob and steal. And we are supposed to just accept this..Our fathers and grand fathers would be disgusted at the way the working man is treated now.

Pavlova's picture

There's more to life than income. What happens to quality of life?

And you can only maintain an attachment to your home country while it resembles your home country, after a generation or two of unrestricted immigration that would no longer be the case and the the model presumably fails.

g16's picture

the working class wouldn't like that.

Red Rain's picture

"Liberalising immigration would double the world's income overnight" That sounds a wonderful idea.... lets put it to the popular vote.....

Zone's picture

Just to be clear, the purpose of mass immigration is to divide and conquer the people of the Western world. You can point out the crime and destitution and disease and cultural death that mass immigration brings *all you want*. But remember that's the whole plan--to them, it's not criticism but congratulations.

Herogothamneeds's picture

Have fun in your basement with your tinfoil hats.

The world will progress just fine without you.

Sigh's picture

Please feel free to return to Denmark where you came from. I would prefer you stay out of the English-speaking world.

plain john smith's picture

Yes, the problem is: where are all these people gonna live? Where are their kids going to go to school? Who will pay their dole money when they are laid off? Who will pay their pensions when they get old? Who will pay their medical costs if they get sick? How about the massive costs associated with the crime committed by the offspring of third world immigrants? Why is he not factoring in the massive drag on the economy of (for example) the Somali community, who live mainly by theft, dole fraud and reproducing lots of little Somalis? White man feeds, black man breeds. Ask the families of WPC Sharon Berezovsky and PC Pat Dunne and PC Keith Blakelock and WPC Nina McKay and Phillip Lawrence what they think about immigration. The massive crime rates now seen in inner London, which is now basically a third world pest hole, must be factored into a cost benefit anaylisis.

radders 's picture

I am sure the people of Calais would love this idea.

radders 's picture

I am sure the people of Calais would love this idea.

Chir0n's picture

What you fail to mention here is that Keenan also predicts a %20 drop in the average income of workers in the richest nations. OK, this prediction is built on the assumption of immediate mass migration (which wouldn't happen) and it's only a short term drop - the average income in those richer nations would eventually stabilise at its previous level - but even so, you could never sell this to us in the west (and here's the rub): we're too selfish.

postageincluded's picture

A 20% reduction in income would be an arguable sacrifice. But for the majority of workers it would almost certainly be a much greater loss, probably more than 50%. The 1% would make the killing, both in cash and in global domination. I can't see why that would be a good thing, but I suppose that's just my lack of Christian charity.

LeonT's picture

I hate people who say '(and here's the rub)'. You're an effing moron.

LeonT's picture

I hate people who say '(and here's the rub)'. You're an effing moron.

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