Marginal Revelation

Marginal Revolutions links to an NBER report attempting to show that immmigration does not harm real wages in the US. Tyler Cowen writes “The best of current investigations continue to support the conclusion that immigration does not hurt American real wages. “[ Marginal Revolution: More evidence on immigration and wages]

This is based on an NBER working paper that says

Recent influential empirical work [I.E. the work of George Borjas] has emphasized the negative impact immigrants have on the wages of U.S.-born workers, arguing that immigration harms less educated American workers in particular and all U.S.-born workers in general. Because U.S. and foreign born workers belong to different skill groups that are imperfectly substitutable, one needs to articulate a production function that aggregates different types of labor (and accounts for complementarity and substitution effects) in order to calculate the various effects of immigrant labor on U.S.-born labor.

Rethinking the Gains from Immigration: Theory and Evidence from the U.S.

I simply don`t believe this. While it`s a game attempt to get around the well-known Law of Supply and Demand, I don`t see how anyone else can believe it either.

You can`t divide the labor force into unskilled foreigners, and skilled Americans, when as we know, there are large groups of unskilled Americans earning low (or no) wages, and massive programs for importing (cheaper) skilled immigrants.