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June 27, 2008

Pay to Stay

Is it so outlandish to suggest that we sell the right to live in the United States? Outlandish or not, such a policy would benefit legal and illegal immigrants alike. By Gary S. Becker.


No one knows how many illegal immigrants are in the United States, Europe, and other countries, but there are surely many millions. Figures for the United States, the country with the largest number, vary widely, but the Department of Homeland Security estimated there were close to 12 million in 2006. There is great disagreement about what should be done about them.

At one extreme are those who call for catching and evicting as many illegal residents as possible. Yet this seems highly unrealistic; the United States will not apprehend and return millions of people to Mexico or other countries. Nor is it desirable to go to the other extreme, offering blanket amnesty to all illegal residents, for amnesty now would encourage future illegal immigration in the hope of a further amnesty. Amnesty makes a mockery of immigration laws and rewards those who came illegally, even as many potential immigrants wait years for the right to come legally.

I argued last year on my shared blog that selling the right to immigrate would be the best approach to legal immigration. Among other benefits, the revenue from immigrants ’ payments could reduce taxes. Paying for the right to immigrate would also negate the argument that immigrants get a free ride when they gain health care and other benefits. Moreover, making immigrants pay would attract the type of immigrants who came much earlier in American history: young men and women who are reasonably skilled and want to make a long-term commitment to the United States. They would be willing to pay a perhaps sizable price because they would stand to benefit significantly from migrating. To prevent the price from excluding young and ambitious men and women who would like to immigrate but cannot afford to come, the U.S. government could encourage a loan program that would be similar to the loans available to college students. The analogy is close because immigration, like college, is an investment in human capital.

Selling the right to immigrate could also be used to deal with illegal immigration. Instead of offering free amnesty to illegal residents, this approach would give them an opportunity to legalize their status without giving them advantages over those who wait to come legally. Illegal residents would be able to come forward and pay to change their status; many would pay gladly, because that would open up jobs and other opportunities to them. The ability to buy the right to stay would be especially attractive to immigrants who want to make a long-term commitment to this country because it would stabilize the future not only for them but for their children.

Allowing illegal residents to pay for legal status should satisfy both those who do not want to give amnesty to illegal residents, and those who do not want to force illegal immigrants to leave the country where they have been working and contributing to the economy. Illegal residents should be required to pay more than those coming legally, as punishment.

Making immigrants pay for residency would attract the kind who came much earlier in American history: younger men and women who are reasonably skilled and want to make a long-term commitment.

To be sure, the problem of illegal immigration would not go away even if all illegal residents were to pay the immigrant price. Some would try to avoid paying by remaining in the underground economy. Perhaps they plan to work for only a short while, accumulate a nest egg, and return to their home countries. If these people were apprehended and wanted to stay, they should have to pay a higher penalty to stay than illegal residents who came forward voluntarily. If they refused, they should be returned to where they came from, with possibly other penalties.

Under current laws, if an immigration quota prevents a person from coming legally, he can then either wait (possibly a long time) for a chance to come legally or try to enter immediately and illegally. A market for immigration gives such a person a legal alternative to immigrate when he wants to. Thus it should greatly reduce the numbers of people who come illegally or remain as illegal residents. The pool of remaining illegal residents would become much smaller as many others were able to legitimize their status by paying for it.

If everyone could buy the right to immigrate legally, the problem of illegal immigration would be hardly more serious than the black markets in cigarettes, alcohol, and gasoline —markets that emerged to avoid the high taxes on legal transactions.

I acknowledge that my proposal to sell the right to immigrate has been criticized as repugnant and contrary to the tradition of free and unlimited U.S. immigration in the eighteenth and nineteenth centuries. But today ’s immigration issues are very different from those in earlier times. Immigration is no longer unlimited; it is severely constrained by various quotas. Is selling the right to immigrate as repugnant as forcing millions of hardworking illegal immigrants to return to countries they left years ago? Or as repugnant as granting amnesty to millions who broke the law?

Selling the right to immigrate is a contemporary solution to a contemporary immigration problem that has created deep divisions within America, pitting people of different ethnicities and skills against each other. Instead of resorting to words such as “repugnant,” critics should consider whether selling immigration slots to illegal residents, as well as to immigrants who enter legally, is a good way to address these conflicts. I believe it is.


Gary S. Becker, who won the Nobel Memorial Prize for Economic Science in 1992, is the Rose-Marie and Jack R. Anderson Senior Fellow at the Hoover Institution and University Professor of Economics and Sociology at the University of Chicago. He is an expert in human capital, economics of the family, and economic analysis of crime, discrimination, and population. His current research focuses on habits and addictions, formation of preferences, human capital, and population growth. He writes commentary for The Becker-Posner Blog and is one of the initial fellows of the Society of Labor Economists. In addition to being a Nobel laureate, Becker is a recipient of the 2007 Presidential Medal of Freedom.


This essay appeared in the Becker-Posner Blog on February 3, 2008.

Available from the Hoover Press is The Essence of Becker, edited by Ramon Febrero and Pedro S. Schwartz. To order, call 800.935.2882 or visit www.hooverpress.org.