Immigration: More Nickels than Dimes

Three reasons why the positive impact goes beyond crude costs and benefits.

Article created by The Century Foundation.

Economists treat immigration like any other phenomenon that generates costs and benefits. They ask the economist’s one-size-fits-all question: What are the additional benefits and costs to Americans of admitting a few additional immigrants? This kind of marginal-change analysis applied to all immigration is flawed for three reasons.

1. By looking at the benefits and costs only to today’s Americans, this analysis biases the discussion against immigration. “Will the last one in please shut the door” is the message likely to emerge. Since virtually all Americans are descendents of immigrants, it is not reasonable to exclude the welfare of today’s immigrants—tomorrow’s new citizens—from the analysis. Any discussion that requires a substantial net benefit for today’s citizens sets the bar too high. Since it is obvious that potential immigrants are willing to leave family and friends, risking discrimination, detention, and even death, to come to the United States, the net benefits to them must be very high. Impoverished relatives left behind benefit too, from the remittances immigrants send home. Such remittances now exceed a billion dollars a month to Mexico alone.

2. The benefits of immigration to today’s Americans are more than the sum of changes in household income from changing the supply of labor and skills. The creativity and dynamism of our economy that is so widely admired all over the world would not exist without immigration. Where would today’s information technology industry be without immigrants from China, India, and Russia? More broadly, where would our leadership in science and technology be without infusions of genius through immigration. Of Nobel Prize winners in the sciences since 1950, 28 percent of those who did their work in the United States were born elsewhere.

3. Most fundamentally, America without a flow of new immigrants would be a much poorer place culturally and spiritually as well as economically. Those periods in our history when anti-immigrant sentiments were at their peak—in the 1870s and 1880s following the Irish immigration, in the interwar period following the Italian, Eastern European, and Jewish immigration, and in the immediate post–WWII period—all benefited from contributions of earlier waves of immigrants. It is hard to imagine an America that is not always changing, always adjusting to new Americans.

Those who would like drastically to limit new immigration are not fundamentally interested in the marginal economic effects of another immigrant household on American citizens (an effect which, by the way, experts agree is positive, if small). They resent the changes to the society they grew up in. What they fail to realize is that the society of their childhood—real or imagined—is no more “authentically American” than today’s America. This country is constantly changing, economically and culturally. Everyone alive today was born into a dynamic, mongrel culture and can expect it to change in surprising ways every year. Immigration is part of authentic America’s soul.


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