Wednesday, June 13, 2012

Would Noah Smith support policy subsidizing the import of high-tech capital goods at the expense of comodities, consumer goods, and designated low-tech capital goods?

I'm assuming not.

But for some reason people get really strange when it comes to labor markets. Noah Smith and Adam Ozimek argue at The Atlantic that we should "grab HSI [high skilled immigrants] from India and Southeast Asia" through policies that they are not particularly concerned about the details of (they write "There are many ideas for increasing HSI, but is not our intent to single out any one of these ideas as "the" solution to the problem. The most important thing, we believe, is simply the outcome: what we need is a much greater number of High-Skilled Immigrants moving to this country.")

We don't need to put our thumb on the scales of international labor markets by promoting one class of workers from one part of the world. We do need:

1. A more liberalized immigration policy in general that runs immigration as a social policy (to build new American families with stable roots) rather than labor policy, and

2. Stronger public investment in scientific research and infrastructure that will generate demand for highly skilled workers. The so called "market failures" are in these final product markets, not in the various factor markets associated with science and engineering (such as the labor market).

As I've said before on here, I'm all for windfalls and pursuing low-hanging rents. We did benefit from the European emigres (as Smith and Ozimek point out), and it's good we snatched up the Paperclip scientists and Soviet expatriates too. Windfalls are great. But we shouldn't make a policy of distorting the labor market without good reason, and "smart people are good for the economy" doesn't seem like a good economic argument to me.


  1. Something being "good for the economy" doesn't seem like a good economic argument to you? I'm not sure what would then. How about it would increase production, efficiency, and welfare?

    I get where you're coming from, and I am a big fan of all immigration, skilled an unskilled. I'm also for very much liberalized immigration markets. But our goal was to argue that removing the part of the current distortion (the distortion being the already restrictive immigration policies) that would generate the greatest externalities should be done immediately.

    My goal is to allow in the most immigrants possible. I agree with you we should be glad to have low skilled workers in too. But I don't think holding that achievement as a constraint on high-skilled immigrant workers is useful. After all, we shouldn't have waited to liberalize the trade of goods before we liberalize the immigration of low skilled workers, should we?

  2. Kuehn:

    1. TOTALLY free labor markets would be one thing. But it can't happen, be realistic. In the meantime, we're a lot better at keeping out high-skilled immigrants than we are at keeping out low-skilled ones. So our thumb is already on the scales on the other side. That was the hidden subtext of our argument, and I hoped people would grasp it.

    2. You'll get no argument from me on the "invest more in research and infrastructure" point, I am with you 107%.

  3. Daniel,

    1. Would you please take the time to point out to Adam Ozimek how absolutely wrong he is about free trade. Here is a good starting point at Angry Bear, but it is time that we bury Globalization, don't you think.

    2. Second, as regards my anon. postings. I know that even Delong

    is on record as trying to put out flame wars.

    My take on flame wars is entirely different. I do not believe that changing of minds happens. The 1954 experiments on Cognitive Dissonance, well discussed by Cialdini in his book Influence show that you do not change minds. Influenced by Col. John Boyd, I believe that online comments are a form conflict. Like all conflict, it is won by making the opponent confront his or her immorality for the purpose of causing internal disintegration. Thus, the goal of my comments is to defeat, not convince.

    This is why right wing wack jobs like Cafe Hayek, FreeRepublic, Rush, Beck, etc., none of them permit open response. For example, Don is a closet racist (his hero is Mencken) and closed his responses in the facing of overwhelming evidence of his racism by reference to Mencken.

    1. I went over to Cafe Hayek, and the top level post by Don allowed comments. Unfortunately, it is through Facebook. Could you link to the Mencken thread?

    2. Dude, don't be a tard. You don't even use your own name. As a young man I hunted down Cialdini, I've forgotten more about Influence then you know.

      Anyone who really has the goods gets paid to put them to use, and they rarely ply their trade freely. You should change your handle to Amateur.

      The goal of your comments should be to defeat, you should focus on not looking like a fucking idiot.

  4. don used to get lots of comments---all gone now

    I don't recall, now,when we started, but he put up some post about wanting to read Mencken if left on a desert island, so many just flamed him about this and other nonsense, until he, first, closed comments and then went to Facebook

    Mencken was such a racist that he denied the Holocaust and then tried to hide his racism by editing his books.

    Don is a world class cull, repeat, world class.

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