[Overview] Immigration V – Demographics

[Part I; Part II; Part III; Part IV; Part V; Appendix; Single page]

by David Severa

  • RESTRICTES: Well, I’d like to look at intermarriage in Europe, and this massive demographic shift as a whole. Europe has a long history of accepting and assimilating intra-European migrants in a multi-generational process that resembles the assimilation of Europeans in America. As I’ve mentioned, groups like Jews and Roma have stood outside this process. From the post-war period to the present, there has been lots of movement within what is now mostly covered by the EU. Though there is variation, by the second generation, basically all European immigrants have intermarriage rates at least as high as Hispanics in America, often breaking 50%. Interestingly, some non-white groups also have very high intermarriage rates – 47% for Black Caribbean men and 61% for Chinese men in the UK. Those are strong signals of successful integration. For the Pakistani second generation in the UK, the numbers are 9% for men (and 2% for women!). The male numbers for Bangladeshi and Indian men are comparably low. And the rates for women are all lower.
  • OPENO: Indian immigrants aren’t generally Muslim.
  • RESTRICTES: True. But apparently religion is an effective barrier to intermarriage in both cases – a bigger factor than race. The rates for Turks in Germany are similar (13% for men). Surprisingly, the rate for Algerian men in France may be as high as 50%, perhaps due to France’s closer colonial links with Algeria. Unfortunately, we don’t have numbers for third generation immigrants (mostly because that generation is still young), so we can’t see if there is a further increase in intermarriage. But it’s obviously an overall worse track record than in America, and don’t forget that the Muslim population in Europe is smaller fraction of the population than Latinos in the US, so the numbers are even more worrisome.
  • OPENO: Those numbers aren’t good, but as you said, we don’t know how things will play out in the future.
  • RESTRICTES: I’d also like to bring up a related concern: cousin marriage. At least half of Pakistanis in the UK marry their first cousin, compared to one in two hundred in the rest of the country. While occasional cousin marriages aren’t especially harmful – the risks are equivalent to having a child in your 40s – when it keeps happening over generations the genetic risks grow very quickly. “British Pakistanis were 13 times more likely to have children with recessive disorders than the general population.” And there is likely at least some lowering of IQ. Plus clannish closely related families may weaken the state. I don’t want to dwell on this; there’s really not enough research on the topic but I’d keep it in mind.
  • OPENO: Well, again, I’d expect assimilation to surrounding norms to occur, even if it takes longer than among other groups. I agree that intermarriage and assimilation are surprisingly understudied considering their importance. But let’s turn to demographic changes. We’ve talked about how well immigrants are going to do, but we’ve neglected the magnitude of what’s happening. Immigration from Latin America to the US has slowed considerably due to lower population growth, better economic prospects and better border control, and has now been overtaken by Asian immigration. Most growth in the Hispanic population now comes from natural growth, rather than immigration. So honestly, there’s not too much to be done policy-wise; most of the growth in the Latino population is locked in. Hispanics are projected to go from 17% of the US today to 29% in 2060, due both to higher birthrates and a younger population structure. (There’s some uncertainty* about how people with only partly-Hispanic ancestry will identify going forward.) Obviously the population structure is going to change as immigration flows drop. And Hispanic birth rates are dropping faster than among other Americans. Given that fertility rates in Mexico and the rest of Latin America have been dropping as well, we are likely to see convergence or near-convergence in the fertility of Hispanic and non-Hispanic Americans. The percentage of Latinos will likely reach equilibrium somewhere above 30% and stay there, again depending on how people identify. Of course that’s a big population to absorb, but basically in line with past waves of immigrants.

* I unfortunately forgot to mention it when I was talking about economic assimilation, but there’s a possibility that if richer, more assimilated immigrants are less likely to identify as Latino, then the third generation stagnation might be nothing but some people dropping out of a Hispanic identity. If so, then the 80% economic convergence Restrictes mentioned could be considerably too pessimistic.

  • RESTRICTES: Still a very large number if there’s even a chance that assimilation isn’t going to work as well this time.
  • OPENO: And what do you say about Europe?
  • RESTRICTES: Europe still faces a choice about who to let in. Currently Europe (including Russia and other non-EU countries) is 5.9% Muslim, which will rise to 10.2% in 2050. This is due to the non-Muslim population shrinking, and increases among Muslims due to both natural growth and immigration. Muslims are the only European group to have replacement-level fertility, and that’s lumping recent immigrants and lower-fertility Muslims from Eastern Europe and the Balkans together. Without immigration, the Muslim population would only rise to 8.4%. Of course, if the North Africa-to-Pakistan region remains destabilized for a protracted period, then refugees could come in much greater numbers.
  • OPENO: That’s considerably lower than I would’ve guessed, really.
  • RESTRICTES: Yes, but consider that there might not be the same convergence you project for Latinos the US, particularly if migrants keep coming. Also, you said that the proper time scale for considering immigration is at least a century, and this is only 35 years in the future. There aren’t good predictions for 2100, because immigration flows are unpredictable, but once could easily imagine the Muslim population exceeding, say 20%? That’s clearly enough to pose major problems if assimilation fails. And remember, this won’t be an evenly distributed population. Some countries like France will have bigger populations/problems than others.
  • OPENO: Hmm, I’m less worried about a long term refugee influx to Europe than you. I guess one’s attitude towards these numbers depends mostly on how optimistic you are about immigration in general. It does seem notable that American immigrants are doing better, even though they’re a much larger group.
  • RESTRICTES: Agreed. I think there’s just one last topic to wrap things up, the effects of emigration on poor countries.
  • OPENO: That’s not something I’ve really considered. It isn’t immediately obvious whether the net effect would be positive or negative. Emigrants make more money they can send back as remittances – equal to 2% of Mexico’s GDP (and 17% of El Salvador’s!). I assume that has a positive impact. Perhaps it depends on who is leaving, those with graduate degrees, average people, the upwardly mobile, the poorest… There could be a brain drain; “there are currently more African scientists and engineers working in the U.S. than there are in all of Africa”. Or maybe higher remittances pay for better education or other things in the home country? Even if world GDP is sure to go up, the distribution of those gains aren’t clear to me. If you’re mainly concerned with the impact of immigration on the developed world, why are you asking?
  • RESTRICTES: If emigration sufficiently weakened a poor country and lowered its per capita growth rate, that could keep the income gap wide and encourage more and more immigration in the future. Think about Puerto Ricans being allowed to freely move to the US, or Spaniards able to move anywhere in the EU. There hasn’t been convergence in either case, but rather a massive outflow of people that has weakened the poorer region. With free exit there’s less of a reason to fix your homeland. As population drops, debt-to-GDP rises, taxes go up, and more people leave. With open borders local governance becomes much harder. (We aren’t really talking about open borders here, but as a side note, the actual open borders that already exist don’t seem that great to me.) Of course, the US doesn’t have open borders with Latin America, nor the EU with the Middle East, and things haven’t reached that sort of crisis. But partially open borders may reproduce at least some of these problems.
  • OPENO: I’m not convinced. Spain’s problems seem much more due to the Eurozone than to Schengen. Poland is in the EU but not the Eurozone. Two million Poles have emigrated in the last ten years, yet Poland has done pretty well economically. In fact emigration likely raised wages. And while Puerto Rico isn’t doing well, it isn’t like the rest of the Caribbean has experienced catch-up growth with the US. These areas have problems beyond open borders, and to the best of my knowledge there’s no good evidence that open borders are a primary culprit in anything. And there’s another open borders region you aren’t considering: the US itself. GDP per capita in Mississippi is half what it is in Connecticut, and yet there hasn’t been some mass destabilization. People move to where wages are higher (or cost of living is lower) and it all pretty much works.
  • RESTRICTES: Moving has costs, and perhaps the relatively small gaps within the US aren’t enough to encourage that much migration. The gap between Mexican and American wages clearly is. And in fact, given the distribution of federal spending, rich states are paying for the privilege of being in the same nation as poor states. So it isn’t actually clear to me that rich states benefit from having open borders with poor states, as opposed to perhaps just a free trade agreement. I know that’s controversial, and I can’t really back it up with the evidence I’d like. In general, I’m not sure economists look hard enough at unexpected side-effects of free trade and open borders.
  • OPENO: Sounds to me like you’re grasping at straws. In any case, emigration is complex and we shouldn’t be too quick to lump in intra-EU migration or intra-US migration or migration from the third to the first world. This is another understudied area, but negative impacts of emigration are hard to find. For instance, African countries that send more doctors abroad have better health outcomes. Emigration probably also raises wages in Mexico. Emigration encourages future foreign investment by creating business ties across borders. Perhaps inequality in the home country can go up? The evidence on emigration is ambiguous-to-positive. I’ll grant that there could be unforeseen costs, but given the huge welfare gains to emigrants, I can’t at all see justifying restrictions on movement given the evidence we have.
  • RESTRICTES: I would agree that the evidence isn’t currently strong enough to prove anything on its own.
  • OPENO: And with that I think we’ve finally covered the main topics we set out to!
  • RESTRICTES: And the time has just flown by.
  • OPENO: Let’s summarize and talk about how our views have changed, if they have. I’m still pro-immigration, but I’ve come to a more nuanced view, hopefully. The clear and significant difference between low skilled immigration to America and to Europe on essentially every measure was a big surprise and I wouldn’t have predicted it. I don’t know what the cause is, but things are definitely going better in the US. Still, even in Europe the economic impact seems pretty unambiguously positive assuming you include the immigrants’ welfare. On both sides of the Atlantic the per capita gains to natives from immigration are smaller than I would’ve expected, but even if it’s break-even, it still makes sense to let people in at no cost to ourselves. That’s true even if there’s less convergence in income than I expect. After all, someone in the US making more money than they would’ve in Mexico but less than me doesn’t necessarily negatively impact me. As for culture, Hispanics commit crime at the average national rate. Assimilation, including language and values, is occurring rapidly. Intermarriage means that ethnic tensions will naturally dissolve over time. I see no good reason to fret about immigration to America. As to Europe, I’m now less certain. I still think that “everything basically works out” is the likeliest outcome, but I’d now assign some non-negligible probability to a serious impossible-to-undo fiasco. I can’t quantify it, but there is a serious worry if things don’t improve. But also remember that many refugees to Europe are coming from very dire circumstances and the welfare gains for them are almost immeasurable. Your closing thoughts?
  • RESTRICTES: America is doing better than expected, Europe just as badly. I think we agree on most of the facts, but our expectations of how future trends will change – whether intermarriage in Europe will significantly increase, for instance – are quite different. Short of waiting, it’s hard to see how we could resolve these disagreements. But I would like to make a plea to people considering immigration in the future. There is no simple dichotomy between a closed border and letting whoever wants to come into your country. You can and should pick and choose. Even if unskilled immigrants to America do okay in the end, by letting in more skilled immigrants instead you could have done much better. Rather than groups that keep the crime rate the same, you could have lowered it. You could have had more people raising average income and investing more, starting more high tech businesses. No electorate would ever allow truly open borders, so unless you want to run roughshod over democracy there’s going to be a limit on how many immigrants per year you let in. Why not maximize the fraction of those immigrants who are high skilled? I’m not saying discriminate by country of origin, of course. Just set requirements like having a college education or having started a successful business, etc. We already do this to an extent, and countries like Canada follow this model with success. If you want immigrants, there are so many high skilled people from the third world who would choose to work in a developed country. Why not them first, if there are going to be limits? Whether you think low skilled immigration will be good or bad, it seems almost impossible to deny that high skilled immigration would be better, both in the short and long term.
  • OPENO: I’m not sure there’s such an obvious trade-off between amounts of high and low-skilled immigration, but that sort of political question seems outside our remit. I’ll close with this: immigration is easy to demagogue but hard to understand. Yet given its importance, understanding, foresight and compassion are all vital. Immigration will shape the future in ways we can’t yet understand.
  • RESTRICTES: On that we both agree.

Next: A bonus dialogue on immigration from Africa

(Source for header image)

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