Howden, Privatizing Entry, Dissolving State Borders: Immigration Policy as the Apex of Rothbardian Libertarianism

— From Rothbard at 100: A Tribute and Assessment, Stephan Kinsella and Hans-Hermann Hoppe, eds. (Houston: Papinian Press and Property and Freedom Society, 2026) —

Privatizing Entry, Dissolving State Borders: Immigration Policy as the Apex of Rothbardian Libertarianism

David Howden¹

1. Introduction

Murray Rothbard’s contributions to economics, political philosophy, and Austrian economic theory significantly shaped modern libertarianism and anarcho-capitalism. Immigration provides a particularly clear illustration of the evolution of his thinking. This chapter examines Rothbard’s intellectual journey from his early support for free movement to his later emphasis on property rights and private governance. This final position carves out a distinctly market-based approach to immigration policy.

Rothbard’s evolution was not capitulation to nativism or political expediency, as some critics have charged.² Rather, it represented a rigorous application of anarcho-capitalist principles to a problem he had not fully considered in his earlier work. The trajectory of his thinking offers valuable insights for contemporary libertarians wrestling with one of the most contentious policy debates of our time. More importantly, Rothbard’s emphasis on privatization and consent points toward solutions that transcend the debate between state-enforced open borders and state-enforced restrictions.

By the time he wrote “Nations by Consent” in 1994,³ Rothbard had developed a sophisticated framework recognizing both the importance of cultural cohesion and the primacy of property rights. This framework helps us understand how markets could solve immigration problems that governments have failed to address. Rothbard offered a path beyond the open-versus-closed border debate by relocating immigration decisions to property owners and voluntary associations.

2. Traditional Libertarian Views on Immigration

The libertarian immigration debate has long featured a fundamental tension between two camps, each claiming fidelity to core principles. Open borders proponents such as Walter Block and Bryan Caplan argue that state-imposed restrictions violate individual liberty and self-ownership.⁴ If individuals own themselves, they must be free to move across arbitrary political boundaries. They emphasize the economic benefits of labor mobility and argue that with robust property rights and freedom of association, there would be no need for state-imposed controls. Property owners could exclude whomever they wished, while those welcoming immigrants could do so voluntarily.

Open borders supporters mostly make their case on economic grounds—that it raises overall wealth—rather than on property rights or cultural considerations. They emphasize that allowing individuals to move freely increases global GDP, raises wages for immigrants, and expands consumer choice, generating net gains for society. Caplan, for example, calculates that unrestricted migration could increase global income by trillions of dollars, likening restrictions to a policy that arbitrarily reduces wealth while violating individual freedom of movement.⁵ While recognizing that some local disruptions may occur, open-border thinkers treat these as minor relative to the overwhelming economic benefits, arguing that markets, labor demand, and voluntary contractual arrangements will naturally mediate potential conflicts.

The restrictionist camp, prominently represented by Hans-Hermann Hoppe and the later Rothbard, challenges these premises while maintaining libertarian commitment.⁶ They observe that vast amounts of land—streets, parks, public spaces—are state-owned and taxpayer-funded. When immigrants use these resources, they impose costs on existing residents who have no say in whether they wish to bear those costs. More fundamentally, restrictionists argue that current state-enforced open borders represent forced integration, not freedom of association. When states force communities to accept immigrants by granting them access to public spaces and welfare benefits, they violate existing residents’ property rights and associational preferences.

Hoppe emphasizes immigration’s cultural dimension.⁷ Unrestricted immigration can transform society’s character, potentially undermining those institutions—property rights, rule of law, limited government—which make a free society possible. If immigrants from cultures lacking these traditions immediately receive voting rights, they may vote for policies antithetical to liberty. This concern intensifies in welfare states where immigrants can vote themselves benefits paid by others. Hoppe argues that “in a fully privatized libertarian order there exists no such thing as a right to free immigration. Private property implies borders and the right to exclude.”⁸

Both sides agree the current state-controlled system is deeply flawed; they disagree about reform direction and who should make immigration decisions in a non-ideal society. Open borders advocates charge restrictionists with making common cause with xenophobic nationalists and sacrificing universal rights for cultural preservation. Restrictionists counter that open borders advocates naively ignore welfare states and democracy realities, pursuing abstract ideals at viable libertarian communities’ expense. Yet both sides recognize the same fundamental problem: state-controlled immigration systematically fails to balance competing legitimate interests, producing outcomes satisfying no one while generating social conflict.

3. Rothbard’s Evolved Views on Immigration

In Man, Economy, and State, particularly in the Power and Market section, Rothbard analyzed immigration restrictions primarily through labor economics, treating them as occupational license benefiting incumbent workers at foreign workers’ and consumers’ expense.⁹ He argued immigration restrictions represent “geographical grants of oligopoly” interfering with market equilibration (p. 1107). This early view reflected Rothbard’s grounding in Austrian economics and his concern with how government intervention distorts markets—a view consistent with his mentor Mises, who also treated immigration as an economic issue.¹⁰

During the 1970s–1980s, Rothbard’s immigration writings remained sparse but sympathetic to free movement. In his 1980 essay on Cuban refugees fleeing Castro’s regime, he passionately defended immigration, declaring that to be “the land of the free, we must return to the traditional American policy before World War I of welcoming immigrants.”¹¹ This argument reflected both anti-communism and libertarian principles, though he hadn’t yet fully grappled with welfare state implications or systematically applied his anarcho-capitalist framework.

The Soviet Union’s collapse prompted fundamental reconsideration. In “Nations by Consent: Decomposing the Nation-State,” published shortly before his death, Rothbard articulated a dramatically different position grounded in rigorous anarcho-capitalist principles. He explained: “I began to rethink my views on immigration when, as the Soviet Union collapsed, it became clear that ethnic Russians had been encouraged to flood into Estonia and Latvia in order to destroy the cultures and languages of these peoples.”¹²

This Soviet example illustrates how immigration could be weaponized to destroy distinct cultures and how unlimited immigration could undermine social cohesion. More importantly, Rothbard recognized his failure to apply anarcho-capitalism consistently to immigration:

On rethinking immigration on the basis of the anarcho-capitalist model, it became clear to me that a totally privatized country would not have ‘open borders’ at all. If every piece of land in a country were owned by some person, group, or corporation, this would mean that no immigrant could enter there unless invited to enter and allowed to rent, or purchase, property. A totally privatized country would be as ‘closed’ as the particular inhabitants and property owners desire.¹³

This insight marked a decisive shift in his analysis. Rothbard recognized that modern “open borders” represents forced integration imposed by states. States, owning all streets and public land, grant immigrants access without consent from the taxpayers who fund these spaces. In contrast, fully privatized societies would have no “public” spaces where anyone could claim entry rights. Every square foot would be privately owned, and immigration would occur only through invitation and voluntary contract. This realization reframed the immigration debate in terms of ownership and consent.

Rothbard also identified welfare state incompatibility with free immigration, noting states “increasingly subsidize immigrants to enter and receive permanent assistance,” creating perverse incentives and imposing costs on residents.¹³ The problem was compounded by birthright citizenship laws, particularly the Anglo-American model where any baby born on national soil automatically becomes a citizen entitled to citizenship (and welfare) benefits. This system, Rothbard (p. 9) argued, “clearly invites welfare immigration by expectant parents,” turning immigration into a mechanism for accessing government benefits rather than pursuing economic opportunity through productive work.

Rothbard’s evolution stemmed from intellectual consistency, empirical observation, and theoretical development. By systematically applying property rights principles to immigration, he recognized state-enforced open borders violated property rights as surely as did state-enforced closed borders. The question became not whether states should control immigration, but how to minimize state control and maximize private decision-making. This mature position acknowledged complexity without abandoning principle, opening doors to genuinely market-based immigration solutions.

5. The Need for a Market in Immigration

Immigration is fundamentally a resource allocation problem best solved through market mechanisms rather than central planning. As I have noted elsewhere,

The core problem of various immigration plans is not the threat—real or perceived—that immigrants will come and use public goods and the welfare system without adequately contributing to its upkeep. The core problem is one of ensuring that both sides of the transaction voluntarily submit to it, and are remunerated accordingly. Discussions about the costs and benefits of immigration, common in the literature, are subsidiary to this one central consideration.¹⁴

Mainstream debates remain trapped in statist frameworks, assuming governments must decide immigrant numbers, origins, qualifications, and conditions. Even broadly libertarian scholars accept this premise, disagreeing only on criteria.¹⁵ A genuine immigration market would transcend this debate by replacing centralized state decision-making with decentralized private choices, harnessing prices, and voluntary exchange to match immigrants with communities, employers, and property owners.

Current immigration systems display several features associated with centralized planning. Government bureaucrats, lacking knowledge and incentives for efficient allocation, set arbitrary quotas based on political considerations. Results include both pervasive shortages and surpluses: desperate employers cannot find workers while qualified applicants languish in decades-long queues, or unauthorized migrants who cross borders illegally to meet the genuine labor demand that legal channels fail to accommodate. The costs are substantial—businesses forgo opportunities, families remain separated, talented individuals face exclusion—while enforcement requires massive expenditures that could otherwise be deployed productively.

A properly functioning immigration market would rest on private sponsorship as its foundation. Immigration would occur through explicit invitation and contract between immigrants and sponsors—employers, families, community organizations, or investment groups. No one would have automatic entry rights; rather, entry would require willing hosts taking immigrant responsibility. This directly addresses Rothbard’s forced integration concern.¹⁶ If every immigrant requires sponsors, immigration occurs only through voluntary association, not state imposition. Communities can choose to sponsor immigrants based on their preferences and assessments, reflecting genuine consent rather than bureaucratic diktat.

Additional principles include conditional public goods and welfare access. In our non-ideal world where public property and welfare exist, immigrants could receive different access levels based on sponsorship arrangements. Sponsors might guarantee immigrants won’t use public assistance, posting bonds forfeited if immigrants become public charges, or pay fees offsetting expected infrastructure use.¹⁷ Drawing on the Austrian concept of the subsistence fund—the stock of capital accumulated and inherited from the past—we can understand that “citizens throughout a country’s history have paid part of their income into a common purse,” which has funded public institutions facilitating the economy’s functioning.¹⁸ Whatever one’s view of their legitimacy, these institutions are financed by taxpayers and constitute accumulated public capital. When new immigrants arrive without compensating existing citizens, they dilute each citizen’s share of these accumulated public assets. Market mechanisms would internalize these externalities, making immigration politically sustainable.

Tiered legal status, rather than current legal-versus-illegal binaries, would allow numerous intermediate statuses determined by contract, with flexible arrangements crafted for mutual benefit. Local variation represents another key principle: different communities would adopt different immigration approaches reflecting different preferences and circumstances. Some might actively recruit immigrants for economic dynamism; others might severely restrict immigration to preserve existing character. Markets would accommodate this diversity, allowing people to vote with their feet.

Several practical mechanisms could operationalize an immigration market. Employer sponsorship, where employers sponsor needed workers, taking conduct responsibility and agreeing to repatriation if employment ends, directly aligns sponsors’ interests with immigration outcomes. Investment-based immigration allows entry by investing substantial capital, representing a market in the value wealthy immigrants bring. Community sponsorship enables religious congregations, ethnic associations, or neighborhood organizations to sponsor immigrants, guaranteeing financial support and cultural integration, distributing costs and benefits to those voluntarily choosing to bear them.

Insurance and bonding mechanisms could address concerns about immigrants becoming public charges or committing crimes. Sponsors or immigrants themselves could purchase insurance compensating victims of crimes or covering welfare costs. Actuarial pricing would create powerful incentives for selecting reliable immigrants and encouraging responsible behavior, providing stronger incentives than bureaucratic oversight.

5. Compatibility with Rothbard’s Final Vision

Rothbard’s mature position in “Nations by Consent” provides a theoretical foundation for market-based immigration. Communities should freely secede, join others, or remain independent based on voluntary choices. Similarly, immigration markets allow communities to set their own policies through aggregated property owner and resident choices. This contrasts starkly with current systems where states force uniformity, overriding local preferences.

Regarding welfare concerns, Rothbard worried that welfare states “increasingly subsidize immigrants to enter and receive permanent assistance.”¹⁹ Immigration markets directly address this through conditional access and sponsorship liability. Requiring sponsors to guarantee that immigrants won’t become public charges—through bonds, insurance, or contractual support commitments—prevents welfare migration. Tiered legal status allows work and trade without immediately accessing welfare or voting rights, replicating approaches Rothbard noted approvingly, like Switzerland’s guest worker system.²⁰

The concern for cultural preservation is accommodated by the market. When communities control immigration through property rights and sponsorship, they can maintain cultural cohesion if chosen. This isn’t state-imposed cultural homogenization but cultural preservation through voluntary association, paralleling how religious communities maintain distinctiveness through selective membership and exclusion rights. Moreover, immigration markets create organic integration incentives, with sponsors helping immigrants succeed through language learning, local norm understanding, and productive relationship development—far more effective than state-mandated assimilation programs.

The deepest harmony between Rothbard’s final vision and immigration markets lies in their shared emphasis on decentralization. Rothbard argued for decomposing coercive nation-states into smaller voluntary communities. Immigration markets embody this principle, with immigration decisions occurring at the most local level: individual property owners, employers, families, and community organizations. This allows different approaches to proliferate, each tailored to local circumstances. Having communities compete over immigration rules mirrors Rothbard’s idea of competing local governments, which pushes each community to develop better, more efficient policies.²¹

Rothbard understood achieving full privatization would require incremental steps from the current statist reality. He wrote that existing states should “try to approach such a system even while some land areas remain ‘public.'” ²² Immigration markets represent exactly such incremental steps, moving closer to Rothbard’s ideal. Each market element reduces centralized state control and expands the scope of private order. As these market mechanisms demonstrate their value, they build support for further reform and show how markets can solve problems governments cannot—potentially sparking a broader shift toward Rothbard’s vision of a fully private social order.

6. Conclusion

Murray Rothbard’s intellectual journey on immigration exemplifies rigorous, principled thinking. From early economic analysis in Man, Economy, and State through final comprehensive treatment in Nations by Consent, Rothbard demonstrated willingness to follow arguments wherever they led, even when conclusions challenged his prior positions. His evolution wasn’t a retreat from libertarian principles but a deeper use of them—moving from a narrow focus on labor markets to a fuller analysis that included property rights, welfare incentives, cultural concerns, and voluntary association.

Contemporary libertarian immigration debates remain mired in statist frameworks which Rothbard transcended. This debate, while illuminating important considerations, cannot escape central planning’s fundamental problems. States lack knowledge for efficient immigration decisions, incentives for balancing competing interests, and legitimacy for overriding property owners’ and communities’ preferences.

Genuine immigration markets offer paths beyond this impasse. By replacing centralized state control with decentralized private decision-making, such markets would harness prices and voluntary exchange information-processing capacity to allocate immigration rights efficiently. Sponsorship requirements, conditional welfare access, tiered legal status, and local variation would create systems where immigration occurs through invitation and consent rather than state imposition, with those benefiting from immigration bearing its costs.

Rothbard taught us that principled thinking requires following arguments to logical conclusions, even when doing so requires abandoning cherished positions. The evolution of his thoughts on immigration demonstrates this intellectual courage. He recognized early support for free immigration rested on an incomplete analysis failing to account for property rights in public goods, welfare incentives, and the importance of consent. His final position corrected these oversights while remaining firmly grounded in libertarian principles.

1. David Howden ([email protected]) is Professor of Economics, Saint Louis University—Madrid Campus, Madrid, Spain.  [↩]
2. Brian Doherty, Radicals for Capitalism: A Freewheeling History of the Modern American Libertarian Movement (PublicAffairs, 2007), p. 417; Sheldon Richman, “TGIF: Immigration vs. Settler Colonialism,” The Libertarian Institute (Feb. 13, 2026).  [↩]
3. Murray N. Rothbard, “Nations by Consent: Deconstructing the Nation-State,” J. Libertarian Stud. 11, no. 1 (Fall 1994; pdf version): 1–10.  [↩]
4. Walter E. Block, “A Libertarian Case for Free Immigration,” J. Libertarian Stud. 13, no. 2 (1998): 167–186; Bryan Caplan, “There Is a Strong Case for Open Borders,” Foundation for Economic Education (April 10, 2019). [↩]
5. Caplan, “There Is a Strong Case for Open Borders,” pp. 45–46. [↩]
6. Hans-Hermann Hoppe, “On Free Immigration and Forced Integration,” LewRockwell.com (June 1, 1999) (also published in idem, Democracy: The God That Failed (Transaction, 2001); idem, “The Case for Free Trade and Restricted Immigration,” J. Libertarian Stud. 13 no. 2 (Summer 1998): 221–233 (also in The Great Fiction: Property, Economy, Society, and the Politics of Decline, Second Expanded Edition (Auburn, Ala.: Mises Institute, 2021). See also related sources cited in Josef Šíma’s chapter in this volume. [↩]
7. , “Natural Order, the State, and the Immigration Problem,” J. Libertarian Stud. 16, no. 1 (Winter 2002): 75-97 (also in The Great Fiction). [↩]
8. “The Case for Free Trade and Restricted Immigration,” p. 221. [↩]
9. Murray N. Rothbard, Man, Economy, and State, with Power and Market, Scholar’s ed., second ed. (Auburn, Ala.: Mises Institute, 2009), pp. 1107–1111). [↩]
10. Liberalism: In the Classical Tradition, Ralph Raico, trans., 3d ed. (Irvington-on-Hudson, N.Y.: Foundation for Economic Education, 1985 [1927]), p. 105). [↩]
11. Murray N. Rothbard, “From Cuban to American Socialism,” Reason (Dec. 1980), p. 60. [↩]
12. Rothbard, “Nations by Consent,” p. 6. [↩]
13. Ibid., p. 7. [↩] [↩]
14. David Howden, “Immigration and the Subsistence Fund,” in A Life in Liberty: Liber Amicorum in Honor of Hans-Hermann Hoppe, Jörg Guido Hülsmann and Stephan Kinsella, eds. (Houston, Texas: Papinian Press, 2024), p. 171. [↩]
15. See, for example, Gary S. Becker, The Challenge of Immigration—a Radical Solution (London: The Institute of Economic Affairs, 2011); Richard K. Vedder, “Immigration Reform: A Modest Proposal,” in Benjamin Powell, ed., The Economics of Immigration: Market-Based Approaches, Social Science, and Public Policy (Oxford: Oxford University Press, 2015), pp. 145–166. [↩]
16. Rothbard, “Nations by Consent,” p. 7. [↩]
17. One sees immediately the similarity to Hoppe’s arguments on the desirability of using insurance companies to solve the collective action problem of national defense. See Hoppe, Democracy: The God That Failed, pp. 228-34; idem, “The Private Production of Defense,” J. Libertarian Stud. 14, no. 1 (Winter 1998–99): 27–52, also in The Great Fiction. [↩]
18. Howden, “Immigration and the Subsistence Fund,” p. 177. [↩]
19. Rothbard, “Nations by Consent,” pp. 6–7. [↩]
20. Ibid., p. 9. [↩]
21. See Murray N. Rothbard, For a New Liberty, 2d ed. (Auburn, Ala.: Mises Institute, 2006), ch. 12 and esp. 282–290.  [↩]
22.  Rothbard, “Nations by Consent,” p. 6. [↩]