Customer Reviews

Friends or Strangers: The Impact of Immigrants on the Us Economy

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This book is one that people interested in immigration policy should read. Borjas relentlessly applies economic theory to the question of immigration, rarely pausing to think about whether he's getting a clear picture or not. It was a fairly ground-breaking attempt to look at immigration from an economic perspective and has quite a lot of useful information. That said, it also is a frustrating book and one that has some pretty significant flaws that should be kept in mind. Here are a few examples. Borjas discounts the idea that discrimination is a significant factor in the poor labor market performance of certain immigrants with no more argument than a reference to the work of Gary Becker and the claim that Becker had shown that there is no such thing as workplace discrimination. Becker, of course, has shown no such thing but had merely provided an a prior argument which was, unfortunately, not born out by empirical enquiry. This part of Borjas's book, then, is completely unsupported. Borjas regularly uses operational definitions of terms (as do most economists) but without realizing how this distorts the picture and limits the inferences that can be drawn from the data. So, he repeatedly claims that new waves of immigrants are less skilled than older immigrants, but what he means by this is just that they do less well in the labor market than did older immigrants. This is a very unusual definition, to say the least, and makes his claims that we should try to recruit more skilled immigrants hard to understand since, on his account, this can only mean that we should recruit more immigrants who will do well in our labor markets. He gives no advice on how to do this, nor on what this would mean as a policy proposal. ("Skilled", on his account, does not and cannot mean "highly trained" or "highly educated".) So, while it may well be true the more recent immigrants are less skilled than older waves, Borjas's use of an operational definition of "skilled" makes his analysis of little use. Similarly Borjas makes a bizarre claim about how the admission of "less skilled" immigrants has imposed a loss on the US economy. This is a bizarre claim since in order to make it he has to imagine that we might have recruited the same number of "skilled" (in his operationally defined sense) immigrants as we did "unskilled" ones in the same time period. He then takes the difference in GDP from the real world and his totally imaginary and probably impossible one and calls this a "loss". This is a loss only in a very funny sense- the same way in which you have a loss of a million dollars when you don't pick the right numbers on the lottery, even if you in fact won 5 dollars and so are four dollars ahead of where you were before. Since there is no reason at all to think we could have attracted this number of "skilled" workers this cannot even realistically be called a lost opportunity. Borjas notes this very briefly in a foot-note, but doesn't seem to notice that it makes much of his analysis in that section of the book nonsense. There are many more examples of similar problems. So, over all, the book is worth reading both for the useful parts, those which discuss various ways in which immigration has changed over time and how immigrants impact the economy, it has enough significant methedological flaws that it cannot be strongly recommended.