BOHANON & STYRING: The economics of immigrating illegally are alluring

March 25, 2017

Economic AnalysisIn the first month of the new administration, border apprehensions of would-be illegals were down 40 percent. Reaction to this news has been predictable. Administration supporters say it’s evidence the “not welcome” word has gotten out to would-be border-crossers. Administration critics say it’s unconstitutional executive overreach. These demographics are important, and we should talk about them. But we’ve noticed there has been precious little discussion of some of the raw incentives for illegal immigration.

At a recent symposium, one of Bohanon’s students made an observation about immigration incentives facing Central American workers. The average Guatemalan worker makes the equivalent of $1 an hour, when he can get work, and it’s paid in rather dodgy local Guatemalan quetzals. His family lives on the edge of bare existence poverty. Tales circulate that he can make $8 an hour doing agricultural labor in the United States. He would have to live in what we would regard as squalid, crowded quarters, but less crowded than his hovel in Guatemala. Those quarters would have running water, indoor toilets and a television. Unimagined luxury! And he’d still be able to remit a comfortable amount to his family back home. Payable in almost magical U.S. dollars!

Put yourself in Jose’s shoes. How many IBJ readers wouldn’t at least toy with the idea of making the long, arduous, dangerous trek to the United States? One doesn’t have to bless or even condone illegal immigration to understand the powerful incentives driving it.

Stricter border enforcement will have some dampening effect. What about the assertion we hear all the time that “immigrants do jobs Americans won’t take?” Basic economics says this is nonsense. Of course, there are no jobs “Americans won’t take.” We should instead say, “As long as the work is not completely suicidal, there will be some higher wage that will induce native workers to accept highly undesirable work.”

Work in North Dakota shale fields is long and arduous. The climate is awful. Accommodations are often in drafty trailers sans summer air-conditioning. Williston, North Dakota, isn’t the cultural capital of the world. But at a starting salary of $90,000, people come.

Without immigrants, maybe we would have to pay American strawberry pickers $40 an hour. Strawberries might cost $20 per small plastic carton. Of course, all-American strawberries couldn’t survive without high protective tariffs, but we could go this route if we chose.

When laws of nations conflict with the laws of economics, economics usually wins.•


Bohanon is a professor of economics at Ball State University. Styring is an economist and independent researcher. Both also blog at INforefront.com. Send comments to ibjedit@ibj.com.


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