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From a purely economic perspective, migration barriers impoverish the world. Eliminating barriers to labor mobility could add tens of trillions of dollars to global GDP. CGD research in this area brings rigorous economic analysis to a politically charged issue and demonstrates that, throughout history, increasing the number of legal, regulated migrant workers benefits both the counties they live in and leave behind.
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Migration is seen as an investment, as migrants are better-educated and richer than others, new research from Michael Clemens and Mariapia Mendola finds.
WASHINGTON, DC – Despite some governments’ attempts to assist overseas development in order to curb migration, development does not immediately deter migration, and those who migrate are not among the world’s poorest, new research released by the Center for Global Development (CGD) has found.
The two new sweeping studies calculate the effects of rising income on emigration for both poor countries and poor individuals. The first paper, by Michael Clemens, analyzed the relationship between real gross domestic product (GDP) per capita and net emigration rates in developing countries. The second, by Clemens and co-author Mariapia Mendola, examines nationally representative survey data on 653,613 people in 99 developing countries to see who migrates, when, and how.
Both levels of analysis confirmed the existence of an emigration lifecycle: Emigration rises along with rising incomes at first, only falling at much higher incomes. Rising incomes for relatively poor countries or people do not immediately deter migration. The researchers found that:
As GDP per capita rises, so do emigration rates. This relationship slows after roughly US$5,000, and reverses after roughly $10,000 (i.e. low- to middle-income, or the level of China or Mexico).
Successful, sustained economic growth in the low-income countries is therefore likely to raise the emigration rate, at least in the short-term. As incomes rise, so too does people’s ability to afford the investments that make migration easier.
These new migrants will not be among their countries poorest: in low-income countries, people actively preparing to emigrate have 30 percent higher incomes than the population on average, and 14 percent of these higher incomes come from more years of education.
“This pattern is not new, or something to fear,” Michael Clemens, director of Migration, Displacement, and Humanitarian Policy and senior fellow at CGD, says. “As a poor country gets richer, at first more people emigrate, until the process eventually slows and reverses itself. We’ve seen it with Sweden a century ago and Mexico a half century ago. We’re seeing it now in Central America, and we’ll hopefully see the pattern emerge in sub-Saharan Africa as that region gets richer.”
“The world’s poorest are not the ones who migrate,” said co-author Mariapia Mendola, professor of economics the Università degli Studi di Milano Bicocca and Director of the Poverty and Development Program at Centro Studi Luca d’Agliano in Milan. “Migration is seen as an investment, just like higher education. You wouldn’t decide not to send your kids to college just because your family is getting wealthier. Similarly, families are not deciding to stay put as their incomes rise. Migration changes lives and economies for the better.”
“Policymakers may see this as a reason to cut foreign aid,” Clemens continued. “That would be unwise. Economic development overseas is in everyone's long-term interest. It helps other countries prevent humanitarian disasters, fight pandemic disease, remain stable, and engage with the world economy. Perversely encouraging poverty, out of a misplaced fear of migration, is a road to nowhere."
Do immigrants from poor countries hurt native workers? A study by an influential immigration economist at Harvard University recently found that a famous flood of Cuban immigrants into Miami dramatically reduced the wages of native workers. But there’s a problem. The Borjas study had a critical flaw that makes the finding spurious.
Imagine you are a Guatemalan living and working in the United States without the proper documents. Almost certainly (because it is legally required) there is a poster in the place where you work—most likely in English and Spanish—that “Equal Opportunity is the Law” and that you are protected from discrimination “on the basis of race, color, religion, sex (including pregnancy), or national origin.”
There are over 25 million refugees in the world today and most of them—especially those in developing countries—do not have formal labor market access (LMA). Granting refugees formal LMA has the potential to create substantial benefits for refugees and their hosts.
An increasingly common justification for European development assistance to Africa is the notion that it will reduce migration from the South. While this sounds intuitive and makes for an appealing argument, the research shows that it is highly unlikely. As communities become less poor, more people gain the abilities and wherewithal to undertake an expensive journey to a better life elsewhere. Development often increases migration—at least initially.
Available evidence points to a superior payoff to female migration from gender-unequal countries to more gender-equal countries for the migrant, the sending country, and recipient country alike. This suggests that a policy by relatively gender-equal countries to provide entry preference to female economic migrants from gender-unequal countries would combine development impact and economic self-interest.