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For the US, "Heaven's Door: Immigration Policy and the American Economy," a 12-chapter book, was the major immigration book of recent years. George Borjas reviews the economic impact of recent immigration on the United States, and recommends that immigration be reduced to 500,000 a year.

In 1979, in "Birds of Passage," Michael Piore surveyed the role of immigrants in the US labor market and concluded that unskilled immigration was inevitable because only migrants with a different frame of reference would fill unskilled US jobs. Piore's "inevitable immigration" set the tone for a generation of scholars and students. Heaven's Door concludes that the US will pay an economic price for admitting large numbers of unskilled immigrants; it may serve as the point of reference for another generation of migration scholars and students.

The world's masses, according to Borjas, see immigration to the US as passing through "Heaven's Door" to the promised land. Borjas, who was born in Cuba and emigrated to the US as a child, argues that, to maximize the economic benefits of immigration to current residents, the US should reduce immigration and change the criteria for entry. If the US does not make this recommended change in policy, Borjas concludes that immigration will continue to permit "an astonishing transfer of wealth from the poorest people in the country, who are disproportionately minorities, to the richest," since the poor are harmed by current patterns of immigration while the rich benefit.

Borjas' purpose in writing Heaven's Door is, he says, to "shift the terms of the immigration debate…toward the fundamental questions" of how many and what types of immigrants should be admitted (p.5). Borjas begins with what he calls the top ten "symptoms of immigration:"

· immigration is at record levels, and contributes more to US population growth then it did at the beginning of the 20th century, even though the foreign-born are 10 percent of the US population in 2000, compared to 15 percent in 1915;
· the relative skills and economic performance of immigrants have declined- the gap between the level of schooling and earnings of US and foreign-born residents has widened;
· the gaps between natives and immigrants will widen further, since immigrants who arrived after 1980 earn about 25 percent less than similar US-born persons and, Borjas says, are likely to close only about 10 percent of this earnings gap in their first two decades in the US;
· national origins matter, since schooling and skills are closely linked to national origins. Mexicans and Latin American immigrants tend to have the least schooling and the fewest skills among US immigrants;
· current immigration patterns hurt unskilled US workers, "accounting for perhaps half of the observed drop" in the relative wages of workers without a high school diploma between 1980 and 1995 (p. 11);
· the cost of providing public services to immigrants exceeds the taxes they pay, costing an average native household in California $1,200 a year in the mid-1990s (p. 12);
· immigration increases the US labor supply and lowers US wages and prices. It increases GDP by about $8 billion in 1998. Borjas notes that the economic contribution of immigrants is small --about one-tenth of one percent of the $8 trillion US GDP, or about $30 a person per year for the US-born;
· the children of many current immigrants do not have well-educated parents. Mexican immigrants have, on average, about seven years of schooling. Their children may have low wages, increasing the difference in earnings that already exists between ethnic groups;
· earnings progress may be slowed further if immigrants and their children cluster in immigrant neighborhoods that lack the ethnic capital to get ahead;
· ethnic neighborhoods may slow integration and lead to problems found in the underclass generally.

There is a consensus among economists that the current mix of immigrants is an overall economic plus for the US; the major issue is how big the economic gain due to immigration is, and how it might be increased. Immigration's economic benefits arise from increasing the supply of labor, which slightly lowers wages, increases the returns to owners of capital, and expands employment, producing a net gain to the US economy of some 0.001 percent. The US GDP is about $10 trillion, so 0.001 percent is a $10 billion net gain due to immigration. At two percent economic growth, GDP increases by $200 billion a year or about $550 million a day. Thus, immigration adds the equivalent of 18 days of normal US economic growth.

Borjas contends that immigration's major impact is distributional, calculating that immigration shifts about $160 billion a year from workers whose wages are depressed by the presence of migrants to US employers who benefit from lower wages; users of immigrants' services also benefit from lower prices. Between 1980 and 1995, immigration increased the number of US residents without a high school diploma by over 20 percent. The wages of all US residents without high school diplomas fell over 10 percent, and immigration has been identified as the major factor depressing wages at the bottom of the labor market.

The educational levels and skills of recent immigrants are rising, but the educational levels and skills of US-born residents are rising even faster, so that the gap between US-born and foreign-born residents is wider than ever before. This raises the question of whether immigrants and their children will catch up to similar US-born residents in earnings. The growing education gap translates into a widening earnings gap. Borjas thus concludes that many immigrants start their American journey too far below similar US residents to close the 25 percent earnings gap. This discrepancy, Borjas fears, will persist in the next generation.

The US has a family-based immigration system, which means that immigration from areas that people want to leave can snowball over time, as immigrants send for their families, and family members in turn sponsor their relatives. The farm economy of Mexico cannot support the people of the Mexican countryside, where about 25 percent of Mexico's 100 million residents live, and they are leaving for Mexican cities and the US. About eight million Mexican-born persons have migrated to the US, and they continue to arrive at the rate of about 300,000 a year, including the half who are not authorized to be in the US.

The question posed by Borjas is whether this great migration off the land in Mexico, which spills over into the US because of the family and social networks built up over the past century, will become an American miracle of immigrant achievement or an American tragedy of a new ethnic underclass. Borjas sees a mostly half-empty glass, emphasizing the education and earnings gaps, the tendency of Latin Americans with little education to gravitate to states such as California, which have relatively generous welfare systems, and the lack of "ethnic capital" in the areas in which Mexican and other less-educated immigrants congregate to serve as a motor for upward mobility. Others see a half-full glass, emphasizing strong and extended families, a tendency toward self-employment, and the rapid acquisition of English in the second generation and beyond.

Instead of the family-unification based immigration admissions system, Borjas favors adopting a Canadian-style point system that awards points to would-be immigrants based on factors expected to make them successful, such as youth, education and good health. A points system is supply-oriented, meaning that it selects newcomers on the basis of factors that are associated with economic success. The current US system for selecting immigrants on economic and employment grounds is demand-oriented, meaning that it gives priority for admission to individuals sponsored by US employers to fill vacant jobs.

Immigration remains controversial, even among economists, as reviews of Borjas's book attest (some of the reviews are at http://www.borjas.com) Heaven's Door was reviewed by Indian-born economist Jagdish Bhagwati in the Wall Street Journal on September 28, 1999, which drew a response from Borjas, and a reply by Bhagwati.

The dispute centered on the interpretation of data. Borjas relied on Census data of immigrants in the US for evidence of the growing gap between the educational levels of immigrants and US-born residents, while Bhagwati argued that INS data show the opposite-that the educational levels of immigrants are rising relative to US-born residents, closing the gap. Neither data source is perfect. However, it should be noted that the INS data infer the immigrants' US earnings from their occupation before arriving in the US, so that, for example, an immigrant who was a doctor in his home country is assumed to earn the median income of a US doctor.

Another point of contention is how employers respond to the presence of immigrants. To some extent, readily-available immigrants create jobs for themselves as, for example, when they open small businesses or seek jobs at day labor markets, encouraging homeowners who would have done work themselves to hire migrants. But economic theory says that society can have more jobs in such situations, or higher wages in such jobs, but not both- other things equal, an increase in the supply of workers will tend to reduce earnings or the rate of increase in wages.

Bhagwati changes the argument, asserting that the goal is to prevent wages from falling with an influx of immigrants. He argues that wages do not have to fall with the arrival of unskilled immigrants if employers respond to the increased supply of workers by adopting "labor-using" methods of production, which Bhagwati believes they do. For example, wages for peach pickers may not decline if farmers leave peach picking machines in the barn when there are plenty of Mexican migrants available. However, the wages of US peach pickers cannot rise very much if they continue to pick by hand, so that an immigrant farm work force can fall further behind other US workers in a growing economy.

There are many edited books with contributions that explore immigrants and trade or labor markets as well as non-economic issues such as education, welfare, social security, and crime. Many of the North-Holland handbooks, for example, include chapters that deal with immigration in their surveys of the literature in the sub-fields of economics.


Borjas, George J. 1999. Heaven's Door: Immigration Policy and the American Economy. Princeton. Princeton University Press. http://pup.princeton.edu/ Piore, Michael J. 1979. Birds of Passage: Migrant Labor Industrial Societies. New York. Cambridge University Press. Borjas, George J., Ed. 2000. Issues in the Economics of Immigration. University of Chicago Press. Ashenfelter, O.C. and R. Layard. Eds. Handbook of Labor Economics. North-Holland. http://www.elsevier.nl/ Borjas, George J. 1999. Economic Research on the Determinants of Immigration: Lessons for the European Union. World Bank Technical Paper no. 438. http://www.worldbank.org/html/extpb/abshtml/14504.htm