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Migration and development, economic growth, aid effectiveness, economic history
Michael Clemens is co-director of migration, displacement, and humanitarian policy and a senior fellow at the Center for Global Development, where he studies the economic effects and causes of migration around the world. He has published on migration, development, economic history, and impact evaluation, in peer-reviewed academic journals including the American Economic Review, and his research has been awarded the Royal Economic Society Prize. He also serves as a Research Fellow at the IZA Institute of Labor Economics in Bonn, Germany, an Associate Editor of the Journal of Population Economics and World Development. He is the author of the book The Walls of Nations, forthcoming from Columbia University Press. Previously, Clemens has been an Affiliated Associate Professor of Public Policy at Georgetown University, a visiting scholar at New York University, and a consultant for the World Bank, Bain & Co., the Environmental Defense Fund, and the United Nations Development Program. He has lived and worked in Colombia, Brazil, and Turkey. He received his PhD from the Department of Economics at Harvard University, specializing in economic development, public finance, and economic history.
A tenuous ceasefire notwithstanding, the millions of Syrians displaced will not be returning home anytime soon. What CGD can do is to delve beneath the anti-migration rhetoric to examine the facts about migrants and refugees, courtesy of our migration expert, Michael Clemens, who joins me on the CGD Podcast.
By now you may have heard of #InequalityIs, the Ford Foundation’s latest endeavor ticking through Twitter feeds around the world. The campaign kicked off last month with a series of videos featuring Sir Elton John, feminist powerhouse Gloria Steinem and journalist/activist/filmmaker Jose Antonio Vargas describing, in two minutes, what inequality means to them. When the Ford Foundation asked senior fellow and migration economist Michael Clemens to weigh in alongside the stars to describe what inequality is, we jumped at the opportunity.
For decades, migration economics has stressed the effects of migration restrictions on income distribution in the host country. Recently the literature has taken a new direction by estimating the costs of migration restrictions to global economic efficiency. In contrast, a new strand of research posits that migration restrictions could be not only desirably redistributive, but in fact globally efficient. This is the new economic case for migration restrictions: empirically, a case against the stringency of current restrictions.
In this paper Patricia Navarro-Palau studies the effects of an increase in school choice by examining a 2008 reform that made the value of Chile's (previously flat, universal) school voucher a step function of student income. This policy increased the proportion of private schools that low income, eligible children could access free of charge from 0.5 to 0.7. She identifies the impact of the policy by combining its introduction with variation from a date of birth enrollment cutoff for 1st grade. She shows that the differentiated voucher lowered the probability that students used public schools by a small fraction and that these students shifted out of low achievement public schools to enroll in low achievement private schools.
We develop and implement a novel, mobile phone-based information clearinghouse, and experimentally evaluate its ability to overcome information asymmetries and improve public service delivery to farmers in Punjab, Pakistan. Like many crowdsourcing websites, our clearinghouse collects and disseminates ratings—here, on the success of government veterinarians in inseminating livestock. We find that, compared to control, farmers receiving ratings enjoy 27 percent higher insemination success. This effect is entirely due to increased veterinarian effort, rather than farmers switching veterinarians. Treatment farmers are also 33 percent more likely to return to a government veterinarian rather than seeking a private provider. These results suggest large welfare benefits from a low-cost information intervention, which holds out hope for improved government accountability for the poor using basic mobile technology.
The economic consequences of large-scale government investments in education depend on the general equilibrium (GE) effects in both the labor market and the education sector. I develop a novel general equilibrium model and derive sufficient statistics that capture the economic consequences of a massive countrywide schooling initiative implemented by the Indian government. I provide unbiased estimates of the sufficient statistics using a Regression Discontinuity design. The earnings returns to a year of education are 13.4%. The general equilibrium labor market effects are substantial: they depress the returns to skill and dampen the increase in economic benefits. These GE effects have distributional consequences across cohorts and skill groups, where as a result of the policy unskilled workers are better off and skilled workers are worse off. In the education sector, more private schools enter these markets negating concerns of crowd-out. These results indicate that researchers and policymakers need to consider the GE effects when scaling up micro-interventions.
Many authoritarian regimes wield the threat of repression to maintain power despite a lack of popular support. In such contexts, citizens who do not support the regime must assess the risk of publicly expressing their dissent and make decisions about how to behave in low-information, emotionally-charged environments. I draw from cognitive psychology to argue that the emotion of fear affects how citizens perceive and process information about repression risk. Specifically, fear makes citizens pessimistic in their perceptions of the risk of repression, and risk averse. I test the implications of this theory using a lab-in-the-field experiment with 671 urban and rural opposition supporters in Zimbabwe. I find that fear reduces participation in dissent by between 14 and 77% on a range of hypothetical and behavioral measures. There is also evidence for a cognitive channel: fear increases pessimism about others' actions and the personal risk of repression as well as risk aversion. These results suggest that emotions can be used strategically to enhance repressive threats to demobilize citizens.
The emigration of skilled workers from developing countries is often referred to as brain drain and considered something that should be limited. In this paper, resident fellow Michael Clemens takes the term to task and shows instead that a more open skill flow—a more accurate and neutral label—would both benefit home countries and guarantee workers the freedom that is the hallmark of development.
President Obama will deliver his 2014 State of the Union speech Tuesday, January 28. We polled CGD experts to find out what they’re hoping to hear when the president addresses Congress and the nation. Check out their oratorical contributions below and read about the development-related decisions and policies they would like to emerge in support of the rhetoric.
Last week I blogged about a research discovery. An influential study had found that a 1980 wave of Cuban refugees into Miami, known as the Mariel Boatlift, had caused the wages of workers there to fall dramatically. In a new paper co-released by CGD and the National Bureau of Economic Research, my co-author and I revealed that large shifts in the racial composition of the underlying survey data could explain most or all of the same fall in wages. The author of the previous study, George Borjas, raised two substantive questions about our research, which I answer briefly in this post.
Photo: EU Humanitarian Aid and Civil Protection / cc
As we approach the third anniversary of the Haiti earthquake, reconstruction and recovery efforts continue—as does the debate within the development community: Why aren’t recovery efforts moving faster? Are international donors and NGOs helping or hurting recovery? Can traditional aid work amidst Haiti's weak government institutions? Are there alternative approaches that would be better?
CGD’s efforts on Haiti’s challenges continue. Here are our recent suggestions for alternative approaches in Haiti, as well as previous innovative ideas that remain relevant:
1) Cash Transfers for Haitians
Vijaja Ramachandran, Senior Fellow
Hurricane Sandy has exacerbated the food crisis in Haiti, as well as increased the incidence of water-based diseases, like cholera. Donors have responded accordingly, but donors must also take steps to improve the quality of their assistance to Haiti. Cash transfers are often the best way to empower disaster victims to rebuild their lives, while also generating demand that fuels the local economy. I recommend the World Food Programme’s Cash for Assets program as an effective model to be implemented for Haitians to purchase much-needed goods and services, in addition to coordinated humanitarian relief.
2) Improve Transparency and Accountability
Vijaya Ramachandran, Senior Fellow, and Julie Walz, Policy Analyst
Since the 2010 earthquake, over $6 billion has been disbursed in official aid to help the people of Haiti. Almost 90 percent of aid has gone to international NGOs and private contractors (9.5 percent has gone to the Government of Haiti and .4 percent to Haitian NGOs and businesses). Yet, there’s very little transparency about how this money is spent. Funders should require more evaluations of NGO and contractor activities, and also report their activities in the IATI format. Further, the Government of Haiti should be encouraged to procure services through competitive bidding. This would not only increase accountability of NGOs and contractors providing the services but also enable the Haitian government to build control over the process.
3) Increase Local Procurement
Vijaya Ramachandran, Senior Fellow, and Julie Walz, Policy Analyst
Out of every $100 spent by the US Government for reconstruction following the 2010 earthquake in Haiti, only $1.35 went directly to Haitian companies. The current US development strategy focuses on stimulating economic activity and pledges support to Micro, Small, and Medium Enterprises along with the development of Caracol Industrial Park. Yet, a key tool is missing in the strategy to build economic security and jobs in Haiti – buying from local businesses.
4) Better Haiti Aid: MigrationMichael Clemens, Senior Fellow
“The U.S. government added Haiti to the list of more than 50 countries eligible to participate in the H-2 visa program for temporary and seasonal workers, ending a longstanding policy of excluding Haitians from America’s largest temporary employment-based visa program. This is wonderful news for Haitians and Americans. It has the potential to unlock hundreds of millions of dollars in new economic opportunity for Haitian workers and their families—at no cost to the U.S. or Haitian governments, and with no increase in overall U.S. immigration. This seemingly tiny change has vast economic potential. Given the huge wage differences (an estimated $19,000 in additional annual income per Haitian worker), if just 2,000 Haitians are permitted to work as H-2 workers in the United States each year, over the course of 10 years, that’s $400 million in additional, new income for Haitian families. That’s equal in size to the entire U.S. post-earthquake budget for reconstruction in Haiti. Building on this great work, the US should consider a Haitian Family Reunification Parole Program. Haitians who have been approved for US permanent residency must sometimes wait as much as 11 years in Haiti to receive their green cards. A parole program would permit some of them to wait for their green cards in the United Stated instead.”
5) Cholera in Haiti: The Blame GameVictoria Fan, Research Fellow, and Richard Cash, Senior Lecturer on Global Health, Harvard School of Public Health
“Since October 2010, Haiti has struggled to control a deadly cholera outbreak—on top of ongoing recovery efforts from the devastating earthquake in January 2010. In December 2011, a group of lawyers in Haiti, on behalf of some 15,000 victims of cholera, sued the United Nations for $50,000 for each victim and double that for families of those who died. Focusing on these immediate objects of blame are of epidemiologic interest, but deflect attention away from the country experiencing the disease, and in this case, unable to control the spread. In a country where aid agencies and NGOs play major roles relative to the government, this outbreak should draw attention not only to immediate causes but more importantly to the long-term failure by every involved party and to the urgency of improving Haiti’s water and sanitation as soon as possible.”
Click here and here to see earlier lists of alternative development ideas for Haiti, featuring more ideas and commentary on post-quake development efforts.
Michael Clemens’s “Foreign Workers Benefit Massively from Guest Work Opportunities” was entered into the Congressional Record by Chairman Tim Walberg, House Education and the Workforce Committee, Subcommittee on Workforce Protections, at a March 14, 2013, hearing, “Examining the Role of Lower-Skilled Guest Worker Programs in Today’s Economy.”