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Security Bonds

A member of the Canadian parliament apparently required that constituents who wanted his help in obtaining visitor visas first post a bond promising that the visitor would return to the home country.   (It's unclear whether any actual exchanges of money took place or whether this was a publicity stunt designed to promote a bill implementing a more formal procedure.)

The ethics of an MP offering money for services is questionable but the basic idea is sound.  Australia, for example, has had a Security Bond system for nearly five years.  Family who wish to sponsor visitors may be asked to post a bond which is subject to forfeiture if the visitor fails to keep to the terms of the visa.  The bond system is good for the government which has fewer illegal visitors to track down (note that I am not here taking a position on the merits or demerits of immigration) but it's also good for prospective visitors.

Under the old system if the government thought that a visitor might violate the terms of the visa they didn't let him in.  Now the family can post a bond and the visitor is allowed entry - moreover, since the money is returned when the visitor leaves, the system has low costs for honest entrants and their families.  Since implementing the system most visitors (68%) are required to post bonds and the entry rate has increased.  A good deal all around.

Posted by Alex Tabarrok on April 8, 2005 at 07:12 AM in Economics | Permalink

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