Why No Refugees?

Why are there no refugees in Economics? Why is there no chapter called Refugees in Economics textbooks?

Because, according to the received canon of Economics, refugees don’t exist, that’s why.

What? Don’t exist? Yep. The core model of Economics is that of Perfect Competition. The perfect economy is composed of an infinite number of tiny consumers and producers (no corporations) where everybody has a tiny equal chance to succeed. How can that be? Because the theorists also assume perfect information, perfect costless mobility, no countries or politics of any kind, and a host of other idealistic pronouncements.

So how can there be refugees? Indeed, how can there be poverty at all? Any individual is free to go (quickly and cheaply) to where all the good jobs are known to be located and live in capitalist paradise. Oh, and yes, there are always tons of good jobs around because the perfect economy is always in equilibrium.

In other words, anyone anywhere who doesn’t have what they need for the good life is just too lazy to work.

But isn’t that unrealistic, I hear you asking? Well sure, but that’s the same way they design cars. They start with a pure frictionless engine in order to get all the parameters right. Engines aren’t frictionless, so the model’s unrealistic. But just throw in a lubrication system, and it’s good to go.

Same with the economy. Start with the frictionless model, by assuming perfect competition. Then we just need to get the government to lubricate the marketplace — or better still, get just out of the way and let the competition run free — and it’s good to go. It’ll work fine. Well, ok, maybe tweak it a little when problems crop up — but keep it free, eh?

That way, there’ll be no poverty, no refugees. Well, if there are, it’s because of politicians who don’t understand Economics. Not our fault. That’s it. No need for a Refugee chapter in the textbook.