Market Correction

10 April 2006

The Editor, New York Times
229 West 43rd St.
New York, NY 10036

To the Editor:

I can overlook many of the weaknesses marring Nicholas Kristof's case for keeping Mexican workers out of America ("Compassion that Hurts," April 9) - such as, for example, his mistaken claim that the Borjas-Katz paper is "the most careful study" of the effect of immigration on wages in America. (Economists Gianmarco Ottaviano and Giovanni Peri sort the data more carefully and find that, between 1980 and 2000, immigration reduced the wages of the least-educated Americans not by 8.2 percent but by less than one percent.)

But I cannot overlook Kristof's willingness to deny millions of desperately poor Mexicans the opportunity of making better lives for themselves in the United States. What moral theory concludes that people born south of the Rio Grande are less worthy than are people born north of that river?

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University

9 April 2006

Editors, New York Review of Books

To the Editors:

Reviewing Daniel Cohen's Globalization and Its Enemies, John Gray writes that Cohen "distinguishes two kinds of economic growth - the 'Smithian' variety that reflects Adam Smith's vision in The Wealth of Nations, in which growth is achieved by utilizing the benefits of the division of labor, and a 'Schumpeterian' variety that is driven by continuous technological innovation" ("The Global Delusion," April 27).

These are not "two kinds of economic growth"; one is intimately entwined with the other. And none other than Adam Smith explained that technological innovation's most lively and reliable spark is an expanding division of labor. In Book I, Chapter I of The Wealth of Nations, Smith wrote that

“every body must be sensible how much labour is facilitated and abridged by the application of proper machinery. It is unnecessary to give any example. I shall only observe, therefore, that the invention of all those machines by which labour is so much facilitated and abridged, seems to have been originally owing to the division of labour. Men are much more likely to discover easier and readier methods of attaining any object, when the whole attention of their minds is directed towards that single object, than when it is dissipated among a great variety of things. But in consequence of the division of labour, the whole of every man's attention comes naturally to be directed towards some one very simple object. It is naturally to be expected, therefore, that some one or other of those who are employed in each particular branch of labour should soon find out easier and readier methods of performing their own particular work, wherever the nature of it admits of such improvement."

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University

8 April 2006

Program Director, All Things Considered
635 Massachusetts Ave., NW
Washington, D.C. 20001

Dear Editor:

In his commentary (April 7), Minuteman founder Jim Gilchrist commits several errors - each one so fundamental that it completely undermines the credibility of everything that he says. I mention here only two of these errors.

First, Gilchrist repeatedly calls today's immigration an "invasion." It's inexcusable to equate unarmed people seeking jobs and a better life in a market economy with armed marauders seeking to kill us and to steal our homes and factories. Second, he asserts that the "magnitude" of immigration today is "unprecedented." Not so. Annual immigration rates peaked a century ago at 1.5 percent of the U.S. population; today's rate is about half that figure. And today's foreign-born population is ten percent, well below its peak of nearly 15 percent in 1910.

Sincerely,
Donald J. Boudreaux
Chairman, Department of Economics
George Mason University