Yikes! Two of My Favorite Economists Go Against Each Other

One of the classic academic studies of the effects of immigration on low-skilled Americans is that of David Card, concerning the Mariel Boatlift. Card found that the sudden Cuban influx had little or no adverse work impact on native African-Americans. Lately George Borjas, one of my favorite economists, has disputed Card’s findings, only to find my UC Davis colleague Giovanni Peri disagreeing. Needless to say, Borjas has been responding to Peri. And today I was taken aback to find that another of my favorite economists, Jennifer Hunt, also disagrees with Borjas.

I have been quite open in pointing out that Peri, while very sharp and by the way very personable, generally does not cite work by those taking views opposite his — a grievous academic transgression — and is prone to contradicting his own work, as I have explained before and is also seen in the first link above. Card is highly prominent, in part because of his pro-immigration, pro-labor work, but I have seen serious indications of his bias as well.

But Borjas and Hunt are the real deal. George may have a viewpoint, but I have never seen anything other than fully professional behavior on his part. To my knowledge, no one has ever accused Jennifer of bias either.

I have not read the papers on the boatlift by any of the above, and I do not intend to, because I believe that this is a question — like many — that can’t be settled by numbers alone.

As a statistician — and all of those papers are purely statistical, nothing really drawing upon economic theory — I have always stressed to my students and my consulting clients the importance of complementing the quantitative with the qualitative. Do the numbers make sense in light of qualitative knowledge, and if not, can the discrepancy be reconciled?

What qualitative knowledge can we draw upon here? There are well-documented examples of immigrant Latinos be hired in lieu of — indeed, replacing — native blacks, such as the case of black LA janitors. There is the infamous example of Hurricane Katrina, in which African-Americans had been hired to clean up and rebuild, only to be told soon afterward that they were fired, because “The Mexicans have arrived.”

So, sorry to say this Jennifer and Giovanni, but I think it’s obvious that the arrival of the Marielitos did adversely impact local black workers. There remains the question of degree and extent of impact, and though some have described the boatlift as a “natural economic experiment,” ideal for settling the question of whether immigration harms blacks, I continue to maintain it just is not possible using just data.

But for the purpose of assessing White House adviser Stephen Miller’s claims in support of the new RAISE bill (second link above), I have to side with him. Mind you, I don’t support the bill — I don’t like points systems, as I would like to see a mix of immigrants socioeconomically, racially and so on — but there is far more to this issue than “He said, she said” academic papers.

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12 thoughts on “Yikes! Two of My Favorite Economists Go Against Each Other

  1. The Mariel Boatlift into Miami in the spring of 1980 happened to coincide with (or perhaps contributed to) the biggest, most notorious organized crime economic boom in American history since Al Capone’s Chicago. Economists should not assume that the only difference between Miami in 1980-84 and other American cities was the Mariel Boatlift. Simultaneously, Miami, far more than any other city in America, was undergoing an economic boom due to Miami being the prime importing place for cocaine from Colombia.

    The Miami economic boom from cocaine in 1980-84 is immensely documented in popular culture, in “Scarface,” “Miami Vice,” “Narcos,” and “The Infiltrator.”

    Cetirus was infamously not paribus in Miami from 1980-1984.

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  2. The Cubans are, in my opinion, the most sophisticated immigrant group in the U. S. And yes, black workers in South Florida have been adversely affected by the Cuban migration into Miami. The reason is not economic as much as it is political. While blacks put all their eggs in the democratic party basket, this was not the case with the Cubans. The Cubans control both sides of the aisle in Miami and it is a deliberate strategy. No matter who is in power they can broker benefits for the Cuban community.

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  3. Norm, point systems are commonplace in Western democracies, including variants in Canada, Australia, New Zealand, Denmark, Germany, ….

    Further, the opposition is not generally reasoned as yours, but part and parcel of an open-borders ideology contemptuous of the ignored and stressed lower and working classes.

    Hence Trump.

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  4. Do you have any idea or hunch as to why African Americans have suddenly – under the Trump administration – recorded their lowest unemoyment rate in 17 years?

    I find it more than coincidental.

    My hunch is that Trumps policies are working to help AAs. Tough enforcement at the border and enforcement of immigration laws has restricted illegal immigration by 70 percent. Many of those people work, and most don’t work in agriculture. Those workers have to be replaced somewhere.

    A smaller but possible contributing factor is his emphasis on manufacturing and energy. I am asuming there are more entry level jobs in the form er for lower-skilled Americans. A longshot possibility also is that a huge reduction in regulations has somehow helped.

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    • Some time in Obama’s second term he got serious about deporting illegals. I was living in south Florida at the time and noticed immediately that the Latino work crews cutting grass or repairing roads started to go from Latinos to blacks. Even though everybody said those were jobs Americans didn’t want to do. Well, they were wrong. I’m sure Trump’s continuation of deportations is mostly helping blacks at the bottom and I’m glad if it is.

      One thing I came upon at that time was a new form of immigrant worker, the tourist worker. While renting a house from a mega-landlord, I discovered that many of its Latino workers were tourist from Argentina and other S.A. countries. They work until their tourist visas are going to expire and then voluntarily leave. Wash, rinse, and repeat.

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      • Before 9/11, the baggage screeners at SFO was almost all immigrant Filipino. It was claimed that this was a job U.S. natives didn’t want to do. Then came 9/11, and Congress passed a law that (a) made citizenship a requirement for the job (for some reason, the Filipino workers had mostly not naturalized) and (b) raised the pay. Lo and behold, U.S. natives applied in droves.

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    • > Do you have any idea or hunch as to why African Americans have suddenly – under the Trump administration – recorded their lowest unemployment rate in 17 years?

      I don’t know, why don’t we look at the actual data and see if we can figure it out? I went to the BLS web site and, in under five minutes, produced the graph that you can see at http://econdataus.com/aaunemp72_17.png . As you can see, the unemployment rate has been coming down steadily since 2011. It appears that Trump has simply done nothing during his 6 months in office to change that trend. In fact, I would challenge you to identify the point on the graph when Trump took office without looking at the dates below the graph.

      Googling this story, it appears that Breitbart broke this amazing story at http://www.breitbart.com/big-government/2017/06/23/black-unemployment-lowest-level-17-years/ . It describes how the unemployment rate has been dropping since February but fails to mention that it’s been dropping since 2011. Then, I can see from google that all of the other sycophants on the web picked up this story. It appears that they all either did not look at the data themselves or they decided to simply echo the same dishonest reporting. In any event, this points to how important it can be to make some attempt to look at the data yourself.

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      • Regarding the unemployment rate for African Americans, I’ve posted a table and 2 graphs at http://econdataus.com/aa_unemp17.html that give a better look at the data. The Breibart article at http://www.breitbart.com/big-government/2017/06/23/black-unemployment-lowest-level-17-years/ states “[b]lack unemployment has been on the decline since February — falling from (February) 8.1, (March) 8.0, (April) 7.9, and (May) 7.5 percent, according to data from the Bureau of Labor Statistics.” As can be seen from the table, they fail to mention the 7.7 percent in January, likely because that would have confused the issue. Neither did they mention that it had steadily declined from 14.5 percent in 2012 and a high of 16.5 percent in 2010. Hence, it appears that the major reason for the improving number is recovery from the 2009 financial crisis. Although there is no sign that Trump has done anything to change the trend, there is no evidence that he has had anything to do with its continuation.

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  5. Yes. It’s time for government policy to move past these little games that economists play, which is what Trump seems to be doing.

    The Cato paper you link to is an interesting example. It frames the issue as the “economics” of immigration, implying that this is different from and superior to discussing the effects of immigration. But it’s not. It’s the same thing. This type of re-framing is a classic manipulative technique, and economists do it a lot.

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  6. Agreed. I truly boggles the mind that there are supposedly highly-intelligent economists who believe that, not only can the data answer this question, but that the effect of the Marielitos on local black workers has any significance to the effect of many different types of immigrants on very different cities now, over 35 years later. I exempt Borjas from this criticism since he does not claim to have made a surprising finding that seems to defy the law of supply and demand. He is simply pointing out that this fixation with Card’s Mariel study is problematic. In fact, I did exchange emails with Card in reproducing the first part of this study at https://github.com/rdavis27/card90 . He actually expressed some surprise that his paper would attract so much interest, saying that he would have tried to keep an archive had he known back then that it would.

    If those economists (or their funders) want to do something useful, why don’t they try to study what is happening to older high-tech workers who are laid off in Silicon Valley or elsewhere? I would contend that this topic is much more important than the effect of the Marielitos on local black workers 35 years ago. I’m tired of watching seemingly bogus newscasts like the one at https://www.youtube.com/watch?v=ijYECVZg-wM with the lead-in, “Santa Clara County is also hiring – or trying to – the starting salary – six figures – Kiet Do on the tech jobs that no one seems to want.” This newscast was dated 4-20-17 but it still seems odd that the site for Santa Clara County tech jobs lists almost no jobs now. Perhaps they should run another newscast about the “tech jobs that no one seems able to find”!

    Of course, workers in many other fields also have difficulties. I found the youtube video at https://www.youtube.com/watch?v=1ucnSnP3OBw&feature=youtu.be about doctors who are unable to find work interesting. And of course the effect of the immigration of low-skilled workers on low-skilled workers in the U.S. is important to study. But economists need to move on from the Card study and join the 21st century.

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