The (refugee) problem with the Coase theorem

The EU’s agreed a €3bn deal with Turkey in order to help keep more migrants in the country, and reduce the influx of migrants. There’s been a lot of squabbling over how much each EU member state would pay, and the commitments have finally been agreed. The cash has not yet been delivered with concrete details yet to be ironed out. This has not been helped with the Turkish President Recep Tayyip Erdoğan threatening to send buses of migrants over the borders. The deal is sweetened for Turkey with a renewed commitment to talk about possible EU accession, and visa-liberalisation for Turkish citizens into the Schengen Area.

Perhaps the last part of that deal would not prove so popular with many EU citizens.  Elsewhere:

…Tsipras has upped the ante again: warning parliament in Athens that he will not allow Greece to become, “a warehouse of souls,” and announcing that if Greece is left alone to deal with the crisis, he would block EU decisions at the next leaders’ summit in Brussels.

The Open Europe post is a good look at how Europe is failing to solve its refugee problems, or even come close.


Coase vs. extortion/blackmail? Is there a difference? Does it matter? DeLong posted a link to Coase's two most famous articles yesterday, The Problem of Social Cost the (later) one I read again and continue to find the most perplexing. If Trump proposed paying Mexicans to stay out of, or leave, the U.S. rather than deporting them and making the Mexicans build a wall, well, so much for his chances of being elected. On the other hand, paying the Mexicans may well work, while mass deportation and a wall won't; Coase is right, so all that's left to the bargain is the haggling over the price. I suppose the problem with extortion/blackmail is that, once it's proved profitable, there's no end to it.

Not exactly Coasian, but "paying" Mexicans to stay home would in fact work better than beefing up border security.

Border security is an arms race between the resources American taxpayers pay our police/wallbuilders, and the resources Mexican smuggling gangs extract from potential immigrants. Given sufficient wage premiums for illegal immigrants in the US vis a vis those who stay at home in Mexico, there will always be enough demand, and money, on the potential-immigrant side to allow the gangs to outbid the police.

However, if Mexicans who stay home in Mexico start to catch up to illegal immigrants, the demand dries up, the gangs lose resources, and the police can win out.

Yep ... very few people who go gaga over the Coase Theorem seem to "get" the extortion parallel.

Coase theorem would involve somehow assigning property rights to the externalities caused by immigration. This is impossible; so imagine we will stick to the policy of pretending there are no externalities caused by immigration. Now back to the last day of work before a nice weekend of driving to the grocery store at the strip mall, staring at screens while my wife catches up on making sure some other guy gets richer after the kids are in bed, and not talking to my neighbors. The American dream.

Some people like to think that the question of whether the exernalities of immigration are positive or negative is an established matter.

"....the question of whether the externalities of immigration are positive or negative"

More importantly: whether the exernalities of U.S./European interventions in the MidEast are positive or negative.

But let's focus on a tertiary symptom (refugees) of the MidEast mess and ignore the underlying problem and cause.

U.S. and European politicians can always be trusted to efficiently mitigate the severe externalities they routinely create (?)

Too true. I remember a time when it was not uncommon for slightly racist people to argue in favour of promoting the economic advancement of foreign nations in order to keep the immigrants out. I'm not sure this quite reflects the thought process, but "keem em' down so they can never threaten us" seems to get a better hearing these days.

The mixture of racism and foreign policy was much nicer, not so long ago.

Turns out the sweet spot for migration is the middle income trap (enough resources to travel, and to have an iPhone to organise it with, not as much or as well paying or prestigious work or state benefits nor gogo clubs or women available to rape with little punishment in the home country). People who are genuinely the world's poorest seem to travel less.

So the arguments change, from the perspectives of Westerners who are not interested in effectively living as racial minorities in Syria or Nigeria (countries fundamentally what they are because, long term, of nothing more or less than the immutable natures of the Syrians and the Nigerians).

Yes, I'm sure the lack of women to rape in the home country is a major motivator behind immigration decisions. Your deep understanding of foreign cultures should be regarded in awe and amazement.

"People who are genuinely the world’s poorest seem to travel less."

Scenario: You earn $300 a year in market income. You have to eat, clothe yourself and get some sort of housing. How many years does it take to buy a one-way plane ticket to anywhere particularly better, assuming you save every single last penny you earn beyond basic needs for survival? Oh, and you have the wrong passport and no education, and will be denied formal status basically anywhere worth going.

"the immutable natures of the Syrians and the Nigerians..."

Pray, do tell, what is "immutable" about their natures that is different from anywhere else? Consider that Syria used to be a fairly broadly tolerant place, but is now fully engulfed in civil war? Which part of their culture is "immutable"?

Explain how the U.S. or Europe is responsible for the current situation in Syria? Because they failed to back Assad the strongman?

I might be able to tell you in a century or so.

It could not have been Obama and Clinton fostering the civil war, drawing lines in the sand, . . .

"Explain how the U.S. or Europe is responsible for the current situation in Syria? Because they failed to back Assad the strongman?"

Only in America are its citizens so clueless they are ignorant of what their country does in its name:

UPSHOT: There is no place on earth so fucked up that the United States can't make it worse:

Afghanistan, Pakistan, Iraq, Libya, Syria, Yemen..

"By 2011 three years of drought, caused by global warming and Turkey's upstream dams and irrigation projects, had weakened the Syrian economy. Large parts of the poor rural population lost their means of living and moved into the cities. They provided the fertile ground needed to launch an uprising against the Syrian state."

Oh yes, global warming set the stage for Syria's civil war. Is there no problem that cannot be traced to global warming?

I'm mostly with Heorogar on this one. The belief that the USA would arm and fund rebels almost certainly drew anyone into the fight who was halfway thinking about it, since they would have assumed that such support would have virtually assured their chances of victory. Since the USA never could possibly have gotten a UN mandate to use its own troops to remove Assad (Russia UNSC veto for strategic reasons and China UNSC veto because the mantra of their foreign policy is non-interference), and since it was nearly as doubtful that NATO would ever formally agree to such a project either, the apparent illegitimacy of any unilateral US effort to depose Assad always implied that funding rebels was the only strategy available. Now we know that the rebels are largely populated by various degrees of violent Islamic extremism, and 20/20 hindsight tells us it was a bad idea from the start.

As for drawing lines in the sand, I think it was more due to the impossibility of getting other countries on board with this un-sanctioned intervention than the preferences of Obama per se. Also, at the time there was virtually no public support for the necessary levels of deployment to enact the proposed no-fly zone.

Essentially yes. The US kept engaging and then disengaging with Assad. Had it been made clear at the start of the uprising that the US supported the existing regime Assad would have been able to go in and crush the rebellion without the rebels feeling they had the west behind them. It wouldn't have been pretty but I think deaths would have been in the thousands rather than hundred thousands. Syria pre civil war wasn't a western democracy but it was fiercely secular, women were unveiled and large and flourishing Christian communities (together with excellent beer and appalling wine) were to be found in every town worthy of the name. I fear our children will find this as unlikely as we now do looking at pictures of Kabul in the 1970s when women were unveiled, were educated and wore mini skirts.

What's not to like? Here are a couple of positive externalities in allowing all of them in: the faster they run out of other people's money and the sooner the socialist house of cards collapses. Added bonus: more rapes and terror attacks.

The Australian solution seems much more humane. Give France the money and relocate the migrants to Corsica until their cases can be adjudicated. This would greatly reduce the number of drownings as well as the exploitation of migrants. Similarly, it would be much more humane of the US to provide assistance to the Central American countries to help overcome their internal issues than it is to promote immigration for the purposes of electoral (Democrats)/ employment (business) / sexual (Catholic bishops) exploitation.

What about the logistics of food, Basic winter shelter and basic security for 3m+ people on the Island then? Basic security is probably the most difficult issue, since presumably there are lots of crooks mixed in. Let them solve it themselves/figure out their own police force? Food will cost EUR 200/head/month, or 7.2 bn, shelter (tents) EUR 100/ea (0.3 bn).

As a Corsican, i feel meh about your idea.
By the way Corsica is one of the most dangerous places in Europe because locals have a tendance to solve their problems with guns.
Immigrant shops are regularly shot.

"Escape From Corsica" starring Kurt Russell, Jean Reno and Lea Seydoux. Screenplay by Jean Raspail and Michel Houellebecq. In theaters Summer 2016.

Turkey needs NATO protection now more than ever. It will not be fun for Erdogan if Trump wins.

I looked up Erdogan in the dictionary and found a picture of Slobodan Milosevic.

Can you enforce the deal?

And this is cute:

Almost as if the hag-chancellor has been implementing a Piven-Cloward strategy at the behest of Peter Sutherland.

Refugee problems are one of those things that are easy to discuss in the abstract, at leasure, when refugees are not in crisis.

When the rubber (and feet) hit the road, it's harder. The solutions discussed at leasure don't seem to work as well under time pressure.

The NGOs with ring binders of procedures are the only ones ready.

When it comes to credibility in brinkmanship, there's no one like Tsipras.

"and visa-liberalisation for Turkish citizens into the Schengen Area."

Why is this of value to Erdogan? If they were high quality citizens emigrating would he not want to slow them from leaving?

Maybe he plans to help ISIS inflitrate

Prestige. He wants to boost Turkey's status in the world, since economic gains are hard to come by and he needs positive results to support his social repression.

Dr. Merkel has done wonders for the Trump campaign.

Trump's basic message is: The establishment politicians aren't on your side.

Has there ever been a more spectacular example of that than Merkel's Boner in 2015?

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