Freeing the ultimate resource
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By Sam Bowman
What’s the single best policy change that could be made to reduce poverty and boost global GDP growth? Many would say the elimination of trade barriers. Unfortunately, many would probably suggest a ‘big push’ of development aid money. But a new paper in the Journal of Economic Perspectives argues that the most positive change that could be made by far is the elimination of barriers to migration.
The paper, which is free to download, compares the existing academic estimates for global GDP efficiency increases from the elimination of trade barriers with those from eliminating migration barriers. Free trade estimates are around 1–5%, or between $600 billion and $3 trillion. This is a substantial figure and would be a huge boost to people in poor countries, since most of it would probably accrue there. But the jaw-dropping estimates for open borders make the boost from free trade benefits look like pocket money.
The existing academic literature suggests that eliminating l...
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