Reddit reviews We Wanted Workers: Unraveling the Immigration Narrative

A meta-study done by The National Academy of Sciences in 2017 discusses macroeconomic effects of immigration over the long-run (in the US). A major conclusion was:

> “Overall, barring sizable immigration-induced economies or diseconomies
> of scale, the most plausible magnitudes of the impact of immigration on the
> economy are modest for those [natives] who benefit from immigration, for
> those who lose from immigration, and for total GDP. The domestic gain . . .
> may be modest relative to the size of the U.S. economy, but it remains a
> significant positive gain in absolute terms.”

Long story short, at least in the US, the economy is so large that immigration hardly effects it in aggregate, but they are positive. For smaller European countries, e.g. Denmark, this could play out quite differently. Furthermore,

> Ben-Gad (2008) analyzed the
impact on the United States of absorbing an additional 60,000 immigrants
per year over the course of a decade. If all these additional immigrants have
college degrees, per capita GDP would rise by 0.15 percent at the end of the
first decade. Ultimately, as the capital stock continues to adjust, per capita
GDP would increase by a further 0.105 percent in the decades that follow.
If none of the additional immigrants have college degrees, the additional
inflow ultimately lowers per capita GDP by 0.09 percent, though natives
still benefit from an immigration surplus.6

Emphasis mine. Interesting, this fits with Borjas' conclusions in We Wanted Workers where he basically says (A) Immigration increases GDP, (B) tends to benefit companies and proprietors, and (C) it increases competition, thus, has a negative effect on low-income wages (think high-school dropouts).

Borjas' conclusions are consistent with the NAS study:

>Wage inequality could also be affected when immigration impacts
the wages of natives (as described in detail in Chapters 4 and 5). If, for
example, immigration increases the relative supply of low-pay, low-skilled
workers and there is only a partial offsetting increase in demand for goods
and services they produce, the pay of low-wage workers will fall relative to
that of high-wage workers—leading to an increase in measured inequality.
If low-skilled immigrants competing with natives are, at the same time,
complements to business owners and high-skilled workers at the high end of
the income distribution, the wages of the latter two groups may rise. Such
wage changes would exacerbate inequality, which is already growing due
to the increasing demand for high-skilled labor that has taken place since
the 1970s. In addition, international trade during this period may have put
downward pressure on demand for and wages of workers in medium- and
low-skilled sectors.

A major point Borjas makes is that earlier immigration to the US was from Europe and that Europeans were more educated. There's been a very large rise in immigration from Central America, not Mexican, who probably never finished middle school coming to the US. They are essentially from the third world and have little to no modern scientific/technical education. These two populations are also very different culturally and it would be odd to think they'd have the same effects.

The graph posted, for me, intuitively makes sense and fits my priors. An exogenous labor supply shock, i.e. immigration, would require funding (capital) and social services (employment) to handle the crisis. Eventually it would mellow as the immigrant population adjusts. It's interesting that asylum seekers' impact is longer-lasting; possibly because they're ideal align more closely with western ideals, hence, why they are seeking asylum.

That said, always be skeptical. There is massive publication bias in politically hot topics and I wouldn't be surprised is academic papers that found enormous negative effects never made it to print because of the journal's management of reputational risk.

The NAS study is free to download by the way.

EDIT: Grammar and spelling, ugh.

https://www.amazon.com/gp/aw/d/0393249018/ref=mp_s_a_1_1?ie=UTF8&qid=1522969015&sr=8-1&pi=AC_SX236_SY340_FMwebp_QL65&keywords=we+wanted+workers

Here it's is have your parents buy it for you off Amazon if they don't have a copy in your Jr. High library

I'm glad to see I got the definition of Kaldor-Hicks right. We appear to have a misunderstanding.

I'm claiming that adding large numbers of low-trust, low-skill immigrants does not generate more wealth for the people who hire them than the amount of wealth consumed by them. I base this on what I've read in We Wanted Workers, from the various estimates provided by the National Academy of Sciences, the Current Population Survey, and others. All of the estimates using reasonable assumptions demonstrate large losses for poor Americans. The losses are so large I am wholly unconvinced that there's enough extra wealth generated by hiring immigrants and taxing the hirers to be able to pay for welfare and Section 8 housing for unemployed Americans.

If you'd like to change my view, you'd need to demonstrate that public housing is cheaper than I thought, welfare is stingier than I thought, immigrants are way better lawn-and-yard maintainers than native Americans, or that low-skill immigrants are all sterile and therefore won't simply generate children who will probably consume welfare in the same amounts as black and/or white Americans with similar levels of skill.

https://www.amazon.co.uk/Wanted-Workers-Unraveling-Immigration-Narrative/dp/0393249018

>"This book cuts to the chase regarding many of the complexities of the infected immigration debate. Borjas uses a non-technical language -- and good writing -- to clearly explain why the mainstream narrative -- that large scale immigration is a Win-Win for everyone is simply not true. There are winners -- the immigrants themselves and employers -- and there are losers -- those who have to compete directly with the immigrants. That means we have to face up to a range of complicated moral and political choices. To pretend otherwise is not only dishonest but is fuelling deep resentment against "the elite" and the mainstream media that have falsely claimed that opposition to immigration is based mainly on ignorance and/or xenophobia and racism."

Read this book: https://www.amazon.co.uk/Wanted-Workers-Unraveling-Immigration-Narrative/dp/0393249018

And this: https://www.pewresearch.org/fact-tank/2018/08/07/for-most-us-workers-real-wages-have-barely-budged-for-decades/

The wages that rise as a result of immigration are those of business owners that profit off of having a wider pool of labor competing for the jobs that they provide.

Massive wage increases occurred in Europe after the Black Plague wiped out a third of the population died. Each laborer had more value due to the constraints on labor supply. Adding labor to your society inherently reduces the amount of money you have to pay your laborers, as there are more of them competing for available jobs.

Edit: the studies you’re citing are also from 1) specific occurrences in specific times, and 2) largely from studies taken during the 20th century and not in the current age of mass immigration from third world countries.

I guess the Bank of Englad research department is outside the mainstream:

>Closer examination reveals that the biggest effect is in the semi/unskilled services sector, where a 10 percentage point rise in the proportion of immigrants is associated with a 2 percent reduction in pay.

I understand perfectly well, that short run impacts of migration will be larger than long run impacts, due to capital having to restructure. But it's anything but proven fact that in the long run the impact will disappear. You can read additional information about long run effects of migration in Harvard Professor George Borjas' book "We Wanted Workers", for instance. Whether or not population size determines wages depends on many things, like returns to scale, etc. But it's not just the size of the population that changes, its skill distribution changes too. He also suggests that it's still a negative effect for low-skilled workers, even in the long run. And George is not just anyone. The Wallstreet Journal called him "America’s leading immigration economist." I Guarantee you, this is mainstream economics.

It boils down to this: With constant returns to scale, after capital readjusted, the per capita GDP will remain constant. But the distribution changes. The MRP of the production function now in relative higher supply will be lower, and thus its wage will go down. If you have mainly low-skilled migrants, that will mean the new relative wage (and because constant returns, also the real wage) will permanently decrease, even after capital readjustments.

Everything else requires a non-constant production function, w.r.t. the labor inputs.

>if you are presented with studies that shows diversity has improved the economy, would you still be confident that diversity makes society worse off?

Yes. A society, or a people, are much more than an economy. The economy exists to serve us, not we to serve the economy.

Furthermore, the usual economic arguments for immigration are severely overblown. I refer you to the work of the Harvard economist George Borjas, and in particular (for a presentation aimed at a general audience) to his recent book "We Wanted Workers": https://www.amazon.com/Wanted-Workers-Unraveling-Immigration-Narrative/dp/0393249018

Your further attempts at rebuttal are puzzling. The link I gave you points to several studies, while you refer only to one. Concerning that, you restrict yourself to the trite and obvious remark that correlation doesn't imply causation. No-one who actually read the link I gave could imagine your remarks to constitute an effective rebuttal. Perhaps you did not manage to read it? I give it to you again: http://thealternativehypothesis.org/index.php/2017/01/07/ethnic-diversity-strength-or-weakness/