Financing Immigration: The Financial‐​Market Value of a Market‐​Based Immigration System

Abstract

The American legal immigration system is in desperate need of reform. One reform idea with far‐reaching potential is the immigration tariff: the sale of permanent conditional work and residency visas that we call gold cards at a price set by Congress. Originally proposed by Nobel Prize–winning economist Gary Becker, the sale of visas would create a more efficient and market‐based immigration system that adjusts to changing economic conditions. As envisioned in this paper, Congress would set a price for visas that is higher than the worst‐case negative fiscal effects and sell as many as the market could bear. Revenue raised from the sale of visas would more than offset any potential negative fiscal effects from immigration and provide a measure of flexible protection for domestic workers. The proposed immigration tariff would not replace other visa categories but would be an additional category.