Becker on Immigration

I attended a talk today given by Nobel laureate Gary Becker entitled “How to Improve United States Immigration Policy.” Becker is one of the most prominent of the Chicago school of economists and won the Nobel Prize in Economics in 1992 for his work in the field of price theory. He is a outspoken supporter of free markets, worked closely with Milton Friedman and George Stigler (also Chicago school Nobel laureates), and co-authors a blog with Richard Posner of the Seventh Circuit and the University of Chicago Law School.

Not surprisingly, Becker proposed that immigration rights be sold to aliens that wish make the US their permanent residence. He threw out $50K as a potential low-end cost, but noted that there were several ways in which prices could be set optimally. The economic justifications of the idea are quite good. He modeled out the net results on countries that lose and gain immigrants and showed that on the whole, immigration maximizes efficiency and benefits the country receiving immigrants in the short term and helps the countries that loose the immigrants in the long run. He showed that selling entrance rights would force self-selection and only those that were truly interested in staying and building a life in the US would be willing to pay. He also argued that the proposal would work for skilled and unskilled workers, and thought that those who did not have the resources to pay could be put on payment plans and showed that even an unskilled workers would be able to pay of a large loan over time due to the increase in income they would get from coming to the US. One area that he failed to address was how these loan payments would be enforced, which I think would be quite difficult.

On the whole, I think the idea is an interesting one. Becker and Posner often discuss immigration on their blog, and I am guessing Posner would in large part support Becker’s proposal, especially considering his support of adoption deregulation (which, over time, has been twisted into his support of “baby-selling” and has probably played a large part in keeping him off the Supreme Court). Apparently Switzerland and Canada have small programs in place that allow people to buy citizenship for extremely large prices. However, while the idea is interesting, given the hot nature of immigration I don’t foresee any politicians championing Becker’s proposal anytime soon…although I’m guessing Mr. Becker isn’t holding his breath either.

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