Put them on the block?
Knocking on Europe’s Door
Seen from the European Union, most of the world out there is threatening, violent and poor. Seen from out there, the European Union is haven and heaven in one. You'd risk your life just to get there. And many do, daily.
So many, in fact, that the EU is finding it hard to cope with the flood. Its asylum policy is roundly judged as inadequate, unable to address the challenges posed by the volume of refugees, and beset by legal deficiencies, political inconsistencies and economic inefficiencies. Its mechanism for sharing the burden—sorry, for sharing the responsibility, is broken, burdening the countries of first entry disproportionately.
As the system now stands, the country where the asylum seeker first enters the EU has the responsibility for that person. A seeker who entered the EU in Greece and got arrested for illegal stay in, for instance, Germany can be transferred back to Greece. Needless to say, the countries on the southern EU borders—Italy, Malta, Greece and Spain—are not happy with this arrangement. They get the feeling that other EU countries are free-riding on the issue and, as a result, do not go out of their way to impede refugees from moving on to the EU heartland. What to do?
CESifo researcher Hillel Rapoport and his colleague Jesús Fernández-Huertas Moraga think they have the answer. In their latest CESifo Working Paper, they propose a market-based system that would ease the task of allocating the newcomers among the member countries and of matching seekers and hosts.
Building upon a previous CESifo Working Paper in which they proposed the establishment of tradable immigration quotas, they extend the idea now to encompass refugees and asylum seekers, adding as well a matching mechanism to better link refugees with prospective host countries.
In essence, the system works by making it possible for a country to receive funds for taking on one more refugee or asylum seeker, and for other countries to pay to receive one such person less.
The EU currently receives about 300,000 asylum requests per year, about one-third of the world total, and 1.3 million refugees. Four-fifths of them end up in a handful of countries: Germany, France, Greece, Austria, UK, Italy and Sweden; 44% of refugees reside in Germany alone. According to the European Commission, the average cost per relocated refugee can amount to 8,000 euros, of which selection and travel account for just over 1,000 euros, the rest being accommodation and other support costs.
Thus, the potential market is significant. But so are presumably the political barriers too. One can just envision livid human rights groups railing against the monetisation of human suffering. But, in the end, the proposal might lead to a speedier, more efficient acceptance and relocation of those suffering refugees. Worth a try?
Jesus Fernandez-Huertas Moraga and Hillel Rapoport, Tradable Refugee-Admission Quotas and EU Asylum Policy, CESifo Working Paper No. 5072