"The Supreme Court’s July 28th ruling on the Affordable Care Act reminded the American public just how elastic the concept of a “tax” can be to a court intent on honoring Oliver Wendell Holmes’s legacy of deference to the legislative prerogative[i]. The flexibility of the term is reiterated in economists’ references to the “inflation tax” imposed by rising prices[ii]. In the same spirit, we could stretch the word “tax” a little further to think about whether the optimal tax theory literature has applications to immigration policies. Immigration law (like Chief Justice Roberts’s “tax”) charges fees, and imposes costs and restrictions on individuals with real consequences for the equilibrium of domestic markets. Given an open mind and a sufficiently liberal interpretation of the word “tax”, optimal tax theory offers a framework for thinking about what could be called “optimal visa policy”, especially with respect to the treatment of high skill workers."
[i] National Federation of Independent Business et al. v. Sebelius, Secretary of Health and Human Services, et al. No. 11-393. Supreme Court of the U.S. June 28th, 2012. See page 31 of the opinion for acknowledgement of Holmes’s judicial philosophy.
[ii] Phelps, Edward S.. 1973. “Inflation in the theory of public finance”. Swedish Journal of Economics 75: 67-82.
This is an idea I've had for a while, so it's a nice opportunity to flesh it out a little. If it's well received I might extend the discussion some time in the future.