American policy for illegla immigration has gone too far

1. I'm referring to the skill gap between all illegal aliens and all americans. In other words, illegal immigrants tend to be low skilled workers. Not a huge discovery.

2. If employers can't exploit illegal immigrants easily, then they get treated the same way as legal workers. Hence, any "gain" from illegal immigrant labor is simply a vestige of nomenclature and not of actual immigration policy.

3. This is the deep question behind it all. And people are now starting to see that you have to approach this problem as a labor supply problem as well, not just one of labor demand (by the fruit boss). Basically, there is a lot of evidence that shows that other things equal, an illegal immigrant has a better chance at getting a job as a migrant fruit picker than an american citizen. This is due to the fact that there are extensive occupational networks in place that hook up illegal immigrants and low level agricultural overseers. It's not necessarily cheaper for the fruit boss to hire these guys, but if the fruit boss derives some other benefit from hiring these guys (say, they're the nephew of a friend) then of course they'll get the job.

It sounds silly, but recent empirical work on this topic has shown that it's a very pervasive phenomenon, especially in unskilled labor markets. It's like when Chris Rock said, "How many people in here got their job from a friend?"

 

1. Yes - and interstingly enough the complement to this is that legal immigrants tend to be far more skilled than the average american - I'm not sure if the proportions match up - but anyway while interesting that's not really that relevant although I guess you could argue it is as a mitigating factor in certain contexts.

2. OK just didn't understand your original statement where you said "workers" couldn't exploit illegal immigrants but I guess that was just a type-o. I'm not sure if employers "can't" exploit illegal immigrants by skirting certain laws (and lowering their costs) in ways that they would not do with native workers. But obviously there is a case to be made that exploitation is a sh-tty justification for anything.

3. Let's rewind the fruit boss example a bit - first there is an argument to be made that that relying on illegal fruit pickers is going to lower transaction costs for fruit boss. Let's say immigrants are removed from the equation. What is fruit boss to do? He's used to fruit pickers traveling thousands of miles and showing up on his doorstep. Now he's got to go out (perhaps due to the perceptions mentioned earlier) and find new fruit pickers at the local mall or job center or whatever. Now even assuming that fruit boss is going to be able to pay the same wages to legal fruit pickers (and remember there is now increased competition for unemployeds from all the other low wage undesirable jobs ). This of course adds on a layer of transaction costs that was formerly borne by the illegals themselves - which may be miniscule, maybe not, I'm not sure.

This leads to the second point; the illegal is willing to pay large sums (in the thousands, I think, or close to that) to coyotes to take them across the border at great risk to their own personal safety. Illegal fruit picker has a lot more invested being a productive illegal fruit worker. Meanwhile, unemployed native guy isn't willing to absorb those same kinds of transaction costs, for whatever reason. Noboody is going to go from Detroit to California to pick fruit for low wages, and I dont' think it is just because of perception like discussed before either. Illegal fruit picker has a lot more invested (both in nominal and real terms) in being an illegal fruit picker than unemployed native guy at the local mall - especially in a situation where unemployed native guys is no longer facing competition from illegal fruit picker & busboy & landscaper, etc. I am inclined to believe (some of this is based on oh so reliable anectodotal evidence, heh...) that illegal fruit picker/roofer/busboy has a lot more incentive to be a good fruit picker/roofer/busboy than unemployed native guy (and offer productivity gains -- prices downward, etc).

Now I understand what you are saying in that some empirical evidence doesn't match in some studies which you noted - this is not all that surprising in the same sense that somebody at NYU (baumol, IIRC? ) last year came out with a paper (which I didn't read but read about) about how free trade w/very low wage countries (read china) doesn't necessarily make both parties better off like the models are supposed to go. But even so I have a hard time believing how we can get an accurate enough gauge of the hypothetical, sans immigrant universe to compare - given the fact that it flies in the face of a lot of what people have been taught.

 

Sam - I understand what you're saying, and your arguments make sense. All I'm saying is that theory suggests that the net effect of illegal immigration on welfare is ambiguous, and most empirical work has shown small decreases in welfare due to illegal immigration (although there were significant benefits to Americans during the Bracero program of the 60's and 70's, if I recall).

At any rate, the enforcement costs of reducing illegal immigration far outweight any welfare costs that we may be bearing due to these guys being here. So I think we can pretty unambiguously say that our current policy is pretty dumb, either in substance or in execution.