The Perks of Being Illegal
By Bryan Caplan
[I]f you’re an illegal worker earning less than the minimum, then when you
become legal, your ability to credibly commit not to turn in the
employer disappears. So the employer could well find it less beneficial
to employ you.
My point, though, wasn’t theoretical but empirical. All the evidence I’ve seen tells me that illegal immigrants find it abnormally difficult to get steady jobs. Yes, they can credibly promise not to narc on their employers. (So credibly, in fact, that words are superfluous). But illegal immigrants can’t credibly promise that their employers can conveniently hire them without fear.
David is right to point out heterogeneity:
Bryan’s evidence is that “amnesty raises wages of formerly illegal
workers.” That could be true on average but it’s unlikely to be true in
But “true in every case” is an awfully demanding standard. How about “true for a significant number of illegal workers in the U.S. workers over the course of a year”? If David can point to any sizable group of illegal workers who have spurned free green cards because it hurts their prospects in the labor market, I’ll happily change my mind.
P.S. David’s analysis suggests an especially evil way to make sure the minimum wage hurts illegal workers. So evil, in fact, that I wouldn’t discuss it if I thought policy-makers might listen to me…
Namely: Hand out green cards to illegal immigrants who turn in their
employers for minimum wage violations. This would obviously inspire
many false accusations, but would make employers very reluctant to give
illegal workers a chance – especially if there are harsh criminal
penalties for minimum wage violations.