A World With Open Borders

9 min readOct 13, 2020

In my last article, I argued that migration of low-skilled workers is not bad for the economy in the macro-level and could even be good. However, after my last article I felt maybe the benefits of it are not as known, if immigration is not bad in both the empirics and theory, what would happen if the whole world would enable “open borders” agenda, how big of an effect could it have? Is it just a small part in fighting global poverty and inequality or could it have a big effect?

Apparently, there has been some fascinating research on this subject, and it is a thing we as a society should definitely know better.

First of all,

What do I mean by open borders?

To clarify, “open borders” means that people are free to move to find work. It does not mean “no borders” or “the abolition of the nation-state”.

After clarifying this notion, why would we even want open-borders?

According to the “economist”, a world of free movement would be $78 trillion richer. Yes, open borders policy would make the world richer by 78 trillion $.

In contrast, Harvard Economist Lant Pritchett, this number would be 65 Trillion$. Still a huge amount.

4 different studies have shown that, depending on the level of movement in the global labor market, the estimated growth of the world’s GDP would be in the range of 67% to 147%. Open borders will make the world around twice as rich.

How would it affect the poor countries?An economist at the University of Wisconsin has calculated that open borders would boost the income of an average Angolian by 10,000$ a year, and of a Nigerian by 22,000 $ annually.

One of the biggest questions economists face is the question of poverty. How can we end it? The capitalist world has made an amazing impact on poverty. Just from 1990 more than 1 billion more people have moved out of what the World Bank considers “extreme poverty”. And now, only 9% of the world population is considered as living in extreme poverty. The World Bank considers this kind of poverty, a paycheck of just 1.9 US Dollars a day.

In order to understand why some countries are rich and some are poor, this would take a much longer explanation, but open borders could let citizens in the countries who stayed poor get much richer, and help people from poor countries become more productive as they move from a poor country to a rich one: As they join a labor market with ample capital, efficient firms and a predictable legal system.

In order for a market economy to work well, as Adam Smith has mentioned already in the 18th century, there must be a law enforcement and legal system. Otherwise, there will be no trust, this as a result will disable investments and therefore economic growth.

Moreover, open-borders will decrease the global inequality by far and will create a much better mobility. If you were born in a poor country, you can still succeed.

We as citizens that were born in the rich world take it for granted, however, it was just luck. Why would we want a world where the biggest thing that determines our future is where and to whom we are born?

I mean, you could be thinking for yourself, opening borders would make the rich people much poorer. But as I showed in my last article, this in reality is usually not true.

In the reality of today, the poorest Billion consume only 1% out of the global consumption, where the richest 1 billion account for 72% of it.

We are so angry about inequality within our countries (within race and genders) but are so indifferent about the global inequality. We spend much more time to attack inner problems and therefore often forget the others. For example, an American worker earns three times as much for the same work as a Bolivian, even when they have the same skill level, same age etc. The economist Michael Clemens and his two co-researches conclude their research on border wage discrimination of the U.S with this: “This means that those barriers(barrier for people to move to different countries) create one of the largest distortions in any global market, create the largest form of wage discrimination observed in today’s world, and create what is apparently the largest antipoverty intervention available for people from poor countries”.

Since we dealt with the economics of immigration in the last article, and we now know the benefits of open-borders on the global poverty level and inequality, I want to tackle here some other social questions in order to further the conversation more by showing the data:

1. Do immigrants pay taxes less than they receive in benefits? It depends.

According to the Organization for Economic Co-operation and Development (OECD), across Europe, the average immigrant household contributes more in taxes than they take in benefit. The same conclusion was also in a study made on Britain. However, the study also found that immigrants who migrate with children and in an older age did use more.

In overall, people who migrate are in most cases young people who are looking for better lives for themselves, the ones who migrate with family are more likely to come as refugees.

Anyway, even if a country still doubts it and prefer to give less tax benefits to migrants, they can. For example, only immigrants who paid 30,000 $ in taxes will be eligible for government benefits, that’s still a win-win.

Since the economic benefits from immigration is already well researched, some people might argue that immigrants increase crime and terrorism and therefore the economic outcome doesn’t matter.

2. Before we go into seeing the evidence, there is a bigger question to ask, is terrorism really a huge threat as usually perceived? If one would have to decide by what we see in the media, the answer was probably yes. Nevertheless, according to the data, it is definitely not.

Between 1975 and 2015, the annual odds of being killed in the U.S in an attack by foreigners or immigrants was just 1 in 3,609,709. And if we remove 9.11 from the data, only an average of one a year, were killed by foreign-born terrorist in those years.

Out of a population bigger than 300 million. Therefore — 1/300,000,000

Just for perspective, the odds of being struck by a lightning in the U.S is 1/1,222,000.

Worldwide, the proportion of people dying from terrorism is 0.03% out of the total deaths, and most of the deaths are coming from the middle east, in countries like Syria, Egypt and Iraq. Not even Israel.

In comparison, 35% of the death incidents reported in New York Times are caused by Terrorism.

Are immigrants importing terrorism? This subject had many interests in recent years in some of the developing countries. Leaders like Donald Trump argue that the people who migrate are terrorists and criminals.

Is it also true in the evidence?

The evidence that checked this connection is pretty divided, depends on which countries one focus.

The ones who saw a small positive effect, was based on OECD countries alone.

However, the ones that saw no evidence checked a much wider number of countries, 170.

This was the conclusion of of the economists “Andrew C. Forrester, Benjamin Powell, Alex Nowrasteh, & Michelangelo Landgrave”:

“we find no empirical evidence to suggest that increases in the share of immigrants from abroad is significantly correlated with higher rates of terrorism. These results hold for immigrants from both Muslim majority and conflict-torn countries of origin.”

Furthermore, there is even a new research from the University of Warwick on migration flows between 145 countries shows that immigration is actually associated with a decline in terrorist acts.They conclude this, by the increase in economic development the migrants have.

So from a look on the data, one cannot really conclude if immigration lead to more terrorism. However, and more importantly, does restrict border control help to prevent terrorist attacks?

The restrict border control in the U.S started mostly after the 9/11 terror attack.

A fun fact: Not one of the 9/11 hijackers was an immigrant, and all had entered the United States on temporary visas.

Moreover, some think-tanks even argue that restrictive policy could actually increase global terrorism. “The more we act in ways that support the picture West vs Islam, the more likely it will be that al-Qaida and other groups are able to attract support for their terrorist cause. “

As Nora Demleitner (2004: 572) points out “many of the terrorism prevention mechanisms instituted in the wake of 9/11 proved fruitful in detecting undocumented aliens, but not terrorists.”

Also, from a look at the recent research that found a positive effect, when they checked what caused the immigrants to become terrorists, they found that it wasn’t because of them, and their origin. This is from the political scientist conclusion: Richard J McAlexander (2019) — “migration does not cause domestic terrorism because of the migrants themselves, but because of reactionary elements within the host country.”

Treating certain ethnicities as “suspects” could arguably be counterproductive as it creates a more polarized society and could lead nonetheless to extremism and more terror.

In addition, the targeting of certain ethnic communities can lead to the loss of support from their home countries that is vital in the fight against international terrorism. The danger is especially acute and ironic for refugees, as those fleeing terror become the first victims of the fight against it.

3. Do immigrants increase the crime rate?

Again, no. According to the data, people making a new life in the U.S commit fewer offenses and less frequently end up in prison than the native population. Even as the number of illegal immigrants tripled between 1990 and 2013 to more than eleven million, the crime rate reversed.

The evidence, based on empirical studies of many countries, indicates that there is no simple link between immigration and crime, but legalizing the status of immigrants has beneficial effects on crime rates.

Will they never go back? Actually, open-borders promote immigrants return. The border between Mexico and the U.S for example in the 1960s, millions of Mexicans crossed it, but in time 85% returned home. Paradoxically, since the U.S militarized the border especially after 9/11, only 7% of illegal Mexicans ever go back.

Many left already before the 1965 immigration law has passed:

The number of illegal immigrants actually rose after 9/11.

The increased costs and risks led migrants to minimize the number of times they crossed the border.

The fall from last decade is mainly started as a result of the Great Recession.

Even if open-borders will be reality, lots of poor people won’t move to a different country. Lots of people just don’t want to leave their country and their communities. Furthermore, travel is expensive and moving demands some valuable skills.

Nevertheless, a huge unchecked migration wave could certainly hurt social cohesion. With that said, we must remember, migration is the strongest weapon against global poverty and inequality, and even just a small change can have a huge effect on many people’s lives. According to Clemens, the benefits are huge even for a more modest loosening of restrictions on immigration. His research suggests that allowing just 5 percent of the people now living in poor countries to work temporarily or permanently in richer countries would add trillions of dollars to the global economy. The economic gains would be greater than those from dismantling every remaining barrier to trade and investment around the world.

Gilad

This data and information for this article was gathered from sources

Such as:

Rutger Bregman — “Utopia for Realists”, “Economist”, “Michael Clemens” and more.