The Disadvantages of Immigration Restriction as a Policy to Improve Income Distribution

In this Article, I argue that tax and tran~fer policies are more efficient than immigration restrictions as instruments for raising the aftertax incomes of the least skilled native workers. Policies to protect these native workers frol1'l immigrant competition in the labor nwrket do no better at promoting distributive justice and are likely to impose a greater economic burden on natives in the country of inllnigration than the tax alternative. These immigration restrictions are especially costly given the disproportionate burden that they place on households with working women, which discourages fel1'wle participation in the labor force. This burden runs contrary to the teachings of optimal tax theory and introduces excessive distortions in the labor market because the supply of female labor is more elastic than the supply of male labor. Thus, the best response to concerns about the effect of immigration on the distribution of income among natives is to increase the progressivity of the tax system.