This section is from the "Economics In Two Volumes: Volume II. Modern Economic Problems" book, by Frank A. Fetter. Also available from Amazon: Economic
§ 8. Popular theory of immigrant competition. The depressing effect of the ever-present and ever-renewing supply of immigrant labor upon wages appears most clearly at the time of wage contests, and often seems to be the most important aspect of the question. Laws against importing labor under contract, passed to prevent this particular evil, puts no check to the great stream of those guided by friends to a "job." Organized labor thinks most of these immediate effects. Commonly labor's protest is expressed in terms of the untenable "lump-of-labor" theory of wages. "Every foreign workman who comes to America" is believed to take "the place of some American workman." The error in this too rigid conception of the influence exerted upon wages by new supplies of labor is evident in the light of the principles of wages. Yet it may be true that, both immediately and ultimately, the foreign workman depresses the incomes of those already here with whom he directly competes. On the other hand, those in occupations into which few immigrants enter may, as consumers of cheaper products, be immediately the gainers in real wages, by the very change that depresses the wages in the lower strata.5 The manufacturing-employers advocate "protection" that enhances the price of their products, while usually favoring "free trade" in immigration to cheapen their costs. What more natural than that laborers should favor a policy of protection to labor, to keep foreigners from coming here to be their competitors?
§ 9. Divergent views of effects on population. The foregoing views of the effects of immigration upon wages, both of those favoring and those opposing it, are short-time views, relating to immediate rather than ultimate effects. If the immediate causes are continuously repeated throughout the lives of successive generations, the results are for those mortal men as ultimate as anything that concerns them. In this case it would make no difference to the millions of workers, whose wages are depressed, if it could be shown that wages fifty or a hundred years from now would be no lower as a result of continued immigration than they otherwise would be; or to the employer that wages would then be no higher. But to the social philosopher and to the statesman, interested in the abiding general welfare, the ultimate economic effects are of the greatest importance.
5 See Vol. I, p. 221, on non-competing classes.
The question is: What will be the far-reaching, long-time effects of immigration upon the general economic situation, as that determines the welfare of the mass of the people 1 We confine ourselves here to the economic effects, leaving aside as far as possible the racial, moral, religious, political, and general social aspects of the subject.
We are met at the outset by two divergent opinions as to the permanent results of immigration upon the growth of population. The one opinion is that all immigrants coming to our shores are net additions, hastening by so much the growth in density of population; the other is that immigration has the effect of checking the natural increase of the native stock so much that it does not materially change the total population, or actually causes it to be less than it would have been had no immigration occurred.
§ 10. The displacement theory; its fundamental assumption. The latter view, known as the displacement theory, was first advanced by a distinguished economist, Francis A. Walker, but his first statement of it referred only to the period between 1830 and 1860. The main argument in support of this opinion was that in the three decades from 1830 to 1860, during which a large immigration occurred, the decennial rates of increase of the population were almost the same as in the three decades from 1800 to 1830.6 The conclusion drawn from these figures was that the immigrants were the cause (by the economic pressure they created) of the decline of the birth-rate occurring in the native stock. The validity of this conclusion is dependent on the assumption that no other forces were at work to produce this result. Must we believe that, but for immigration, the native birth-rate would not have declined at all ? This is incredible. The birth-rate of the native stock had already begun to decline before 1820, as is shown by many family records, and by the fall of the decennial rate of increase from 35 and 36 in the decades ending 1800 and 1810, to 33.1 and 33.5 in the next two decades. This occurred despite the enormous western settlement then under way on the Louisiana Purchase. The decline of the birthrate began at that time to appear as a world-wide phenomenon, accompanying improved transportation (roads, steamboats, steam railways), the rapid growth of cities, and the general industrial revolution. The general birth-rate has declined of recent years in Australia and New Zealand, where there has been little immigration, more rapidly than it has in the United States.7
6 See Vol. I, p. 429, for figures of population and of decennial rates of increase; also § 6, above.
§11. Magnitude of the inflow of immigrants. The displacement theory still has upholders,8 but in view of the facts it seems necessary to modify it greatly. To the extent that the coming of immigrants caused a net addition to the population, it doubtless hastened the growth of cities and the development of industrialism, and thus helped to reduce the birth-rate in some classes. But this view admits the effect upon population which the displacement theory denies. Probably in a good many cases the more rapid business advancement of the natives, because of the coming of the immigrants, led to the decline of birth-rate
7 The effect of the growth of cities is discussed in the "American Journal of Sociology," Vol. 18, p. 342, in an article on "Walker's Theory of Immigration," by E. A. Goldenweiser.
8 One of the best recent statements of it is that of H. P. Fairchild, in "Immigration," pp. 215-225, citing various opinions, and accepting the view of Walker. But he says (p. 216) : "It must be admitted that this is not a proposition which can be demonstrated in an absolutely mathematical way, which will leave no further ground for argument." that is a consequence of economic success.9 But a large part of this change would have inevitably occurred even if there had been no immigration after 1820. Between 1820 and 1910 the population increased 82,400,000, and the total number of immigrants was 27,800,000, or 33.7 per cent of the total increase. The birth-rate among immigrants in cities always has been very much higher than that of native Americans, in the same cities. This fact alone might well be taken as sufficient to offset whatever depressing effects the coming of the immigrants may have had upon the native birth-rate, leaving the immigration nearly a net addition to population. It does not seem possible to believe that, if there had been no immigration, our native population, rapidly advancing in average wealth, wages, and general education, would have continued with an unchecked birth-rate, and would have filled all the places taken by immigrants. And no believer in the displacement theory has ever ventured to claim, as the argument requires, that if immigration were now stopped the birth-rate would again return to the old standard of 1820, or would cease to decrease somewhat. Especially of late, since the rate of increase of the native population has become much less, is the effect of continuing immigration apparent. In the decade of 1900-1910 the total population increased 16,-000,000, while nearly 9,000,000 immigrants arrived. Of the remaining increase, 3,000,000 consisted of children born of foreign parents. That leaves, at the most, 4,000,000 increase attributable to the native stock, white and negro combined.
 
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