Asylum economics

Immigration policy blogging will be officially closed after today. Just one more pre-election query relating to the Conservative Party’s detailed policy proposals on asylum.

From the manifesto:

Our objective is a system where we take a fixed number of refugees from the UNHCR rather than simply accepting those who are smuggled to our shores. Asylum seekers’ applications will be processed outside Britain.

David Davis elaborated in an interview with Simon Mayo on Five Live (may still be in the audio archive here): a Conservative government would liaise with the UNHCR to take a fair quota of refugees from among those registered at or near their point of origin. Presumably, this would involve these (‘genuine’) asylum seekers being brought directly to the UK from camps or holding centres in affected regions.

Leave aside that a quota system can never be truly equitable. Consider the issue from a purely (economic) nationalist perspective. But this is almost what the Tories are doing, isn’t it? Well, no: Tory proposals are unlikely to produce the best economic outcome for Britain. They are, in fact, almost certain to cost us more.

Any market where asymmetries of information exist, such as the ‘market’ for those trying to get into the UK, suffers from problems of adverse selection. Basically, ‘buyers’ (us) have no way of knowing, a priori, the true qualities of those competing in the marketplace (in this case, to enter the UK). One way round this is for participants in that market to send out ‘signals’, which are interpreted and valued by the buyers.

In the unlikely event that many of those seeking asylum will have packed high school diplomas, their resourcefulness in getting from wherever they are to the UK should do fine as a proxy signal. We can probably assume that the most resourceful (and healthiest) among them are most likely to succeed, and therefore over a lifespan contribute more in tax than they take in healthcare and social security. In short, they will cost us less and benefit us substantially.

Thus, the anarchic, Darwinian race to Dover that we have at the moment selects the best quality asylum seekers the world has to offer. Economic nationalists ought not to be voting Tory. Accepting those who turn up at Channel ports is economically preferable to taking a random selection from a refugee camp in Darfur.