From an economist’s perspective is there any doubt whatsoever that immigration is a good thing?
The evidence is overwhelmingly that immigration is a good thing. Certainly it’s a good thing for the receiving countries in the medium term. It’s a good thing for the migrants themselves, for their families and those that depend on their remittances. It’s also a good thing—but sometimes a mixed thing and does have some negative consequences—for the sending countries, where the migrants are coming from. These countries can suffer as a result of—often—the most dynamic people leaving. The taxpayers who pay for the education of those people—like the doctors and nurses and professionals—that leave countries are subsidizing the countries that they are going to, who aren’t paying for the education and training of those people.
There are ways of dealing with that, and, despite that, I think that it can be very beneficial for the sending countries as well. The main question, often, for the receiving countries is that there are specific places that suffer in the short-term.
Such as where?
In the UK, a place like Slough for example — a town near Heathrow Airport. It might find it has a disproportionate number of immigrants compared to the size of the population and compared to immigrants in the rest of the country. That will put pressure on its school system, on its housing and it could put a bit of pressure on the job market. Previous generations of people may feel undermined by immigrants. That’s really a failure of public policy — because immigration is very good for the UK, even if it’s not necessarily good for one specific place in the short term. You need public policy to help the places and the people that are under pressure.
What would you do about immigration in Slough?
My view is that, firstly, one needs to encourage immigrants to disperse, and not to concentrate in particular places. That’s partly about what services you provide them with — whether you provide them with housing, with education. In fact, most of them don’t need education as they are active adults. But sometimes they do. Obviously, how one helps people find jobs is important.
Then for the places themselves, like Slough, one would have to invest more, because immigration is very beneficial for the UK. The UK is making a lot of money out of immigrants. It gets much more in taxes than it spends, on average, for immigrants. But in specific places, like Slough, it might not be: the expenditures might be greater than the benefits. So the Treasury needs to help places like Slough to support the pressures that are placed on it by immigrants.
Why do you think there is so much resistance to embracing immigration, if the data are so clear? We always seem to go out of our way to do things that are good for the economy, but in this case, not.
There’s a real disconnect between the evidence and the politics. People don’t feel that immigrants are beneficial — even though, of course, we are all immigrants in origin. There is a tendency—perhaps a psychological tendency—for people to be mistrustful of the other, of outsiders. That’s particularly manifest when times are perceived to be ‘tough’ — after the economic crisis.
But also when we feel threatened by the other — when we see terrorist events or risks that come from beyond our borders. Immigrants become the personification of this fear. It’s completely misguided, but it’s played on by politicians and populist media and others in a way that is extremely unhelpful.
“People also point to congestion and say the UK is a small island that doesn’t have room for more people. That’s a very misguided analysis.”
The economic evidence is clear. We have the business community in the UK calling out for more—particularly skilled—immigrants and yet we have the politicians moving in the opposite direction. My sense is that this is just playing into fears and populism. There’s no rational reason for it. Some people seek to find rational reasons [for being anti-immigration] in economics, but none of the studies support this. There is no serious study that supports their view — not only for the UK but for other countries as well. Or they talk about things like pressure on housing market.
It might be true that foreigners are pushing up the prices of properties in Kensington, but that’s not the average person’s problem. The reason why house prices are going up around the country is not because of foreigners, it’s because of a lack of investment in housing — and some population growth. Yes, that growth is partly the result of immigrants, but actually population growth is very, very good for a country. When you look at the chancellor, George Osborne’s, projections for this rosy future he talks about, it’s entirely based on assumptions that there will be many more people employed than there are currently in the labour force. That means we’re going to have to have more immigrants to have a rosy future. People also point to congestion and say the UK is a small island that doesn’t have room for more people. That’s a very misguided analysis.
Anyone who knows the UK knows a couple of things. Firstly, people flock to the most crowded places, notably London. London is the most dynamic, the most successful place with the highest share of immigrants in the UK. That’s why it’s so successful, by the way. That’s why people like it so much, because it’s so cosmopolitan and has so much to offer in multiple dimensions, not only in culture, food etc. — but also in innovation and investment that’s coming from foreigners, That’s where the jobs are — because foreigners are there.
Also, as we know, there are vast parts of England which are not heavily populated — and parts of the countryside are actually being depopulated. This is really about investment decisions. Obviously if you don’t invest in rail, you don’t invest in roads, you don’t invest in housing, you’ll get more and more depleted services. It takes longer for me to get to London from Oxford now than it did when I was a student. It used to take 50 minutes on the train and now it takes, at best, an hour. That’s not because of immigrants. That’s because of public policy failure. The same is true of other perceived congestion and overpopulation effects.
We’re sitting here in Oxford University’s Martin School, which, when I was a undergraduate, was the history faculty library. It reminds me of hours spent engrossed in books about 17th century Europe, when mercantilism was the prevailing economic ideology. Many people at that time thought exports were bad — that when you export something to another country you somehow lose that wealth. Nowadays, you’d be hard pressed to find a single person who thinks an export is a bad thing. Don’t you think immigration is still at that stage — where people don’t fully understand the economics of it? That they aren’t aware that having a bigger population is a positive?
People aren’t aware. One of the reasons I wrote my book, Exceptional People—which has the subtitle ‘How Migration Shaped our World and Will Define Our Future’—is because, as an economist, I felt this profoundly positive story is just not getting out there. It’s also a deep story. None of us would be where we are today without it, civilizations wouldn’t exist. And it continues to be a fact.
If you’re trying to think about where the UK is going to be, or where the US is going to be in the future, and how we’re going to meet big challenges, it’s the key explanatory factor. That’s not getting across. But my concern is that even when it does get across, people still feel, ‘Okay, even if the economics is positive, I don’t like it.” One has to deal with the cultural, psychological and political dimensions of this as well.
Let’s go on to your books. The first one you’ve chosen has a great title: Bloody Foreigners by Robert Winder. He’s telling the history of British immigration, and through it we find out that even quintessentially British things like Marks & Spencers…well, in short, Marks was an immigrant. Why have you picked this book?
Robert is a journalist so this is a very well written book, in journalistic style rather than academic, but very well referenced and sourced. It is the story of immigration into the United Kingdom over the last thousand years. The title reflects what every generation has said for the last thousand years, the constant refrain of how somehow they are the indigenous people and those coming are foreigners. What the story tells is how we imagine our own identities as being the identity of the country, but it’s just supplanted on top of someone else’s.
A thousand years ago, people didn’t speak English here, in England. More recently, Queen Victoria’s family were all German. She grew up speaking German, and yet we think of her as quintessentially English — the symbol of England and Englishness. So it’s about how we create these myths. It also shows how important foreigners were in creating all the successes that we associate with England and our heritage: including the Industrial Revolution and everything else. So it’s very good at both showing how we create this idea of who an immigrant is and who is foreign and how vital they are to the society.
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There are two ways of understanding how we’re all foreigners. One is to do genetic testing—which I’ve done, it’s great to do—to see where you come from. The other is to understand your history. This is the history. Anyone who thinks they’re really English should read this book.
So there was no particular point at which immigration came to be seen as a problem?
There are waves, and waves in which different groups are identified as the foreigners. The book talks about anti-Jewish sentiment at times, anti-Indian subcontinent at times, anti-German sentiment, anti-Polish sentiment etc.
At other times, how they’re embraced. And how this changes over time. But yes, foreigners are generally not liked. The book is a very good read, which is why I recommend it.
Do you want to tell me about the next book, Borderless Economics, which I think is also by a journalist?
Yes, it’s by Robert Guest. He also writes very well. He’s telling a contemporary story. It’s about the current period and he is showing how immigrants are not only creating dynamism within a society, but investment networks and technology transfers. It’s a series of examples from different economies—China, the US, UK and others—in which he highlights how none of these investment flows, trade flows and innovation processes would happen without individual people that have moved and travelled. These immigrants become the catalysts of economic growth and change.
He talks about the ‘haigui’ or Chinese sea turtles. Do you want to explain what that’s about?
It’s the story of the Chinese diaspora around the world and how they were able to bring ideas and investment back into China and how China’s transformation from Communism to an open, very dynamic, economy is dependent on this network, which has become stronger and stronger over time. You now have millions of Chinese around the world who are learning and sharing ideas and that has become a source of dynamism for the society.
So all the Chinese-Americans are helping trade ties with China?
Absolutely, they are the catalyst. They become the source of identifying the need in one society — what Chinese goods would be great in the US, or what they could take back from the US that would work in their society at home. They have the knowledge. They have internalized the needs of different societies, and are able to identify market niches, opportunities, technological transfers, innovations.
It’s this diversity—and this is something I also focus on deeply in Exceptional People—that creates the innovation drive. It’s like Gutenberg inventing taking a wine press and a money printing press and creating a printing press. For these people, when it comes to innovation, one and one does not equal two, it equals 10.
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So they might take a Chinese idea and an American idea and put it together?
Yes, that’s what immigrants do. And this is a great book that has examples of this diaspora effect.
Can you give me an example of another Gutenberg?
There are thousands. Look at Silicon Valley, which for us is the iconic symbol of innovation in technology. Try and think of an emblematic Silicon Valley firm that was not started by a foreigner. Google, Yahoo, SpaceX, Tesla these were all started by foreigners. There are some, but I challenge you think of many of them that were started by people that weren’t foreigners. Steve Jobs…
His father was a Syrian immigrant wasn’t he?
Yes. And that’s partly because these people come in and are able to combine ideas, but also because they—and their parents—are more dynamic. They have chosen to take a risk by migrating. If you look at things like patent filings in the US, immigrants are completely disproportionately represented. Try to think of an Academy Award winner or Nobel Prize winner who isn’t an immigrant. There are very few. Immigrants bring this creative juice, and this book gives you a sense of that. He focuses on skilled immigrants, which is one dimension.
He doesn’t deal with unskilled?
No, but in Exceptional People I deal with all different categories. Obviously refugees are a whole category apart.
He’s got one phrase in there that I saw when I was looking at the reviews, he talks about the ‘miracle of migration.’ He says that because of immigration America will remain the world’s number one economy.
I agree with him. I don’t agree with him about number one—because China is going to become number one— but I agree that immigration is the reason why the US will remain much more dynamic than Europe…
Because they embrace foreigners more?
Yes, although that’s being tested at the moment. You wouldn’t believe it, listening to the Republican presidential candidates….
Tell me about your next choice, The Age of Migration.
This is the classic textbook. Stephen Castles has been going since the 1970s or early 1980s. When I was a student I read his books and that was a long time ago. It’s a comprehensive view of how important immigration is, what drives it, push-pull theories and so on. It’s now in its fifth edition. If you want one book to read about the theory of immigration, the background to it, this is the best — apart from my book of course.
And it’s readable, despite being a textbook?
All my book choices are readable, none of them are only for economists.
Book number four on your list is called The Age of Mass Migration. This is more historical, looking at the 1850-1914 period.
This is a great book. Williamson and Hatton are two great economic historians. What it highlights is just the scale of that immigration. At times a third of Ireland, a third of Sweden, a third of southern Italy, was migrating. It also highlights how many went‑—not only to the United States—but to South America, the mass migration to places like Argentina, which is often forgotten. It also highlights how many came back later, when conditions changed. For some of these destinations, in later years, a third of people returned. And it highlights the role of technology in all of this: it was really the steamship that allowed it to happen.
It was the combination of the push— pogroms, famines, political conflicts in Europe—and then the steamship suddenly enabling it to be a much safer, quicker, and cheaper passage. If you think we’ve got mass migration now, you have to read this book. It’s nothing compared to that period. I find it fascinating. The book also highlights how there were no passports in that period.
People could just come and go freely?
Yes. And of course, in Europe, there were far fewer countries. Immigration is, by definition, the crossing of a border and it’s become tighter and tighter.
It’s quite technical isn’t it? I saw some equations about the impact on the labour market back home.
Don’t worry about the equations! This is not a book for specialists. Anyone can read this book.
OK, so in terms of this mass migration, there are about 50 million people moving around. Can we say that it definitively had a good effect, this having no passports, everybody being allowed to move freely?
So if today we said, ‘Let’s scrap passports, let’s let all the refugees from the Middle East go where they want to go.’ Would that be OK?
You’ve got to think who you’re talking about here. A lot of these people would have died. A lot of us wouldn’t be here without this age of mass migration in the 19th century. People would have died in the pogroms, they would have died of famine in Ireland. There are different reasons people emigrate, but generally it’s to survive and to improve their own lives and those of their families.
That’s true, in great part, for refugees, who are a very specific legal category of immigrants. For them, the other option is death or persecution. You just have to look at the pictures of Aleppo to get a sense of what they’re leaving behind. So it’s certainly good for them. 95% of them are going to neigbouring countries — to Turkey, to Lebanon, to Jordan. We’re getting a tiny, tiny fraction in the UK. Germany is accepting a million refugees this year, which is quite extraordinary. In the UK, we’re accepting less in two years than they’re accepting in two days.
When you listen to the foreign minister of countries like Germany or Sweden speak — they seem to see refugees coming in as a positive.
You should look at the GDP numbers for Germany. Germany is predicting higher GDP growth this year — because of the refugees. But, by the way, I’m not so naive as to recommend a world without borders.
I like that idea.
There are two opposite corners to this. There’s total control: think North Korea, for what you’ll end up like. Total openness is, I think, a bit utopian. Europe—and the Schengen zone, which I strongly believe in—is the first experiment we’ve seen, in the 20th century, of removing borders. And it worked fantastically. It’s not leading to mass migration — even though unemployment levels are 60% for youth in Greece or the south of Spain.
“The Schengen zone, which I strongly believe in, is the first experiment we’ve seen, in the 20th century, of removing borders. And it worked fantastically”
As far as I know, there are very few unemployed Greek or Spanish kids on the streets of London or anywhere else. That’s because, basically, people stay at home. So yes, but it’s idealistic. Like free trade, it’s an endpoint — rather than a place we can get to in the near term.
Schengen has led to economic growth?
Nobody would dispute that. Lots of studies have shown that.
Now for you last book, A Man of Good Hope, which is by the South African novelist, Jonny Steinberg.
This is a tough read. It’s the story of a kid, a Somali refugee. It’s about how he became a refugee, about his family being killed. And how he bumped around in different African countries, eventually making his way to South Africa. A remarkably brave, a remarkably hopeful kid who is just constantly in the most terrible situations. Then he experiences the xenophobia against Somalis in South Africa.
These other books I’ve talked about are journalists or academics talking about migration, this is a protagonist. It’s based on numerous interviews Jonny did with this boy and it portrays his story. There are many books that are important immigrant stories. This one is very poignant and well written.
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