"The implicit model is that once people have spent money for an asset they
value that asset more than they would value their prospective income stream from
living in the United States. Jane postulates a kind of endowment effect for
immigrants. Moving away from family-based immigration also limits potential
trustable allies for law-breaking.
I suspect that auction-based proposals
will result in too few legal unskilled immigrants, and also more illegal
immigration of the unskilled, but I would not rule out this idea just yet. I'm
still waiting for someone to write down an impossibility theorem for a good
immigration policy, noting that much of the domestic demand is for immigrant
traits (e.g., cheapness and immediate readiness to work) which are strongly
correlated with illegality. That is some employers want (explicitly or
implicitly) to deny some of their workers the benefits of integrating with the
U.S. capital stock. "
Without agreement, I think that these are some interesting ideas and it does raise a good point. If a system is created to make immigrants legal, will the people who hire them even want to employ them anymore. If a system is set up where they will be treated fairly, why not hire an American if you are not going to get a worker you can abuse. I know this has a negative assumption to it, but there is reason to believe that illegal workers are cheap because they are illegal, and they are hired because they are cheap, which means they are hired because they are illegal.
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