Economics and the mid-life crisis have much in common: Both dwell on foregone opportunities

C'est la vie; c'est la guerre; c'est la pomme de terre . . . . . . . . . . . . . email: jpalmer at uwo dot ca

. . . . . . . . . . .Richard Posner should be awarded the next Nobel Prize in Economics . . . . . . . . . . . .

Monday, May 09, 2005

Why Do First-Generation Arab-Americans Do So Well?

An article by Moises Naim in the Financial Times ($ subscription req'd for more than the first two paragraphs) reports (h/t to Tyler Cowen at Marginal Revolution):

People of Arab descent living in the US are better educated and wealthier than the average American of non-Arab descent. That is one surprising conclusion drawn from data collected by the US Census Bureau in 2000. The census also found that Arab Americans are better educated and wealthier than Americans in general.

Whereas 24 per cent of all Americans hold college degrees, 41 per cent of Arab-Americans are college graduates. The median annual income of an Arab-American family living in the US is $52,300 - 4.6 per cent higher than the figure for all other American families. More than half of such families own their home. Forty-two per cent of people of Arab descent in the US work as managers or professionals, while the overall average is 34 per cent.
Tyler's explanation for the difference is

Islam is an excellent religion for motivating commercial success (yes I do know that many Arab-Americans are Christians).
But I think I prefer the explanation offered by The Emirates Economist:

My take is that if you are born in an environment where merit is not rewarded, then you'll be more likely to move to an environment where it is -- if you have innate or acquired abilities.

... Note that compared to recent immigrants in general, Arabs admitted to the U.S. are much more likely to be admitted because of their education -- as opposed, say, to political ayslum. And Arabs that have come to the U.S. primarily for non-economic reasons were also self selected - those with the means to escape from regimes that went totalitarian or countries with political violence.

... For whatever reason, Arab countries have not fostered economies where the rewards to productivity (increasing the size of the pie) are high -- and the rewards to rent seeking (getting a bigger slice of the pie) are low [emphasis added]. Contrary to the headline ["Culture is not the culprit in Arab poverty"], culture remains one of many potential culprits for why Arab countries are not developing as quickly as others.
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