Sunday 15 November 2015

Adverse selection in the EU migration policy after the Paris attacks

Previously, the EU member countries came to some agreement of each country receiving a certain number of Syrian refugees. However, the attacks in Paris this Friday fuel the migration debate. Many people believe there might be more terrorists hidden among the refugees, and such belief is very reasonable. From humanity aspects, we should accept the innocent refugees; however, it is very difficult to identify each refugee's genuine background. With the lack of information, the safest way is to reject all the refugees, so there is no possibility for terrorists to pretend as refugees and enter the countries. This is also the most common way for people to deal with adverse selection. Such phenomenon is called by economists as "the market for lemons". Therefore, if no countries have 100% confidence to identify the refugees' genuine identities, no countries will take the risk of being attacked by terrorists. My opinion is after the Paris attacks, the number of refugees accepted by the EU countries will fall sharply.

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