Transcript POL 4410 Migration Structure Economics of migration Political

POL 4410
Migration
Structure
1. Economics of migration
2. Political economy of migration
3. Migration Policies
4. Migration and the USA
5. Migration and Security
Economics of
Migration
• Think of migration like other flows: from
abundant to scarce areas.
• What should relationship be between
trade and migration?
• Who benefits in advanced countries?
Who loses in developing states?
$/hour
Economics of
Migration
Supply
0
Supply1
C
B
D
Demand
Employment
Economics of
Migration
• US income was 0.1% or $8bn higher
because of immigration.
• Migration and allocative efficiency
• Moving 100m migrants from low to high
income countries could raise world
GDP by 8%.
Migration Hump
Migration
Flow
A
B
Time
Different Migrants
• Distinguish high-skill migrants from lowskill migrants. Why do high-skill
migrants leave areas where they are
scarce?
• Refugees and family members - noneconomic migration.
• Migrants can also bring capital.
Political Economy
• Arrival of low-skill migrants will reduce
returns to low-skilled work following
Stopler-Samuleson.
• High-skill individuals benefit from new
arrival of low-skill workers as do owners
of capital and land.
• What about immigration of high-skill
workers?
Race and Religion
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Not just economic factors.
Many countries don’t mind white
immigrants, even low-skilled ones. For
example, Poles in Europe.
Nonetheless, think of antipathy towards
Irish, Southern, and eastern Europeans in
USA in late 19C.
Islam and immigration.
Migration Policies
1. High Skills: Supply and Demand
Policies
2. Low Skills: Guest Workers, Amnesty,
and Refugees and Families
3. The Three Rs
High Skills: Supply
• Points systems: Canada, UK, Australia
• Identify high-skilled workers who would
‘benefit’ economy.
• They pick us
• Auctioning visas
High Skills: Demand
• Employer demand. Migrant as ‘most
suitable’ applicant for job
• Labor market tests.
• H1B visas.
• Auction off visas to employers?
• Requires significant bureaucracy
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Low Skills: Guest
Workers
Guest workers are temporary and fill 3D jobs.
germany 1970s. US Braceros.
Attempt to prevent long-run increase in
migrant population.
But difficult to convince people to go home.
End up with families arriving.
Over-reliance on cheap labor inputs: catsup
Plus, civil and political problems.
Low Skills: Amnesty
• Reagan offered Amnesty to migrants in
1980s.
• Allows immigrants to enter work force
and stay permanently.
• But reduces deterrent threat to illegal
immigration.
• Civil and political problems.
Low Skills: Refugees and
Families
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Asylum-seekers are the newest group of
migrants. From post Cold War collapse of many
states: Somalia, Kosovo, Albania, Afghanistan.
UN Convention on Refugees. 1951.
‘owing to a well-founded fear of being persecuted for reasons of race,
religion, nationality, membership of a particular social group, or political
opinion, is outside the country of his nationality, and is unable to or, owing to
such fear, is unwilling to avail himself of the protection of that country’
Families: can these groups really be denied access.
What to do about family members who do not join
workforce?
The Three Rs: Return
• Getting emigrants to return
• Diaspora-led development: Taiwan,
Ireland.
• Taiwan Hinschu Science-Based
Industrial Park. 40% of companies
headed by returnees
• Subsidize returnees through UNDP?
Typically returnees only stay as long as
the subsidy does.
Remittances
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Remittances are massively important component
of income for many states. Multiplier effect of 2-3.
Stable.
Major recipients: India, Mexico, Philippines.
Jordan (23% GDP), Nicaragua (17%)
Good source of foreign currency but need official
banking channels and low costs
Brazil floated bond against future remittances in
2001. Some Asian states, Korea, stipulate set level
of remittances
Recruitment and ‘Brain
Drain’
• Recruiting high skill migrants means
taking them out of poor countries where
they may be needed: teachers, nurses,
doctors, entrepreneurs.
• Compensation?
• Or does ‘brain drain’ actually help
poorer states by raising the return to
education?
Migration in the USA
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Current Political Debate: 12 million illegals. Pressure on
wages and on social services.
House Bill of 2005: Build Wall, Impose strict penalties on
employers, criminalize illegals and those that help them
Senate Bill of 2005 (McCain / Kennedy):
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Z-Visa illegals here for 5 years can apply for
citizenship after paying fine. i.e. amnesty for 10 million.
No ‘chain migration’
Y-Visa 6 yr guest worker scheme
Remove employer sponsorship and replace with
points system
Increased border enforcement
Legal and Illegal
Differences across
USA
Dynamic Picture
Latin American Bias
Across Time
Card vs. Borjas
• Card: immigrants cannot have ‘taken’
jobs - they have expanded workforce.
Most are unskilled. Wages didn’t
change following 1986 amnesty. Mariel
boatlift.
• Borjas: argues that those without
college have suffered 5% decline in real
wages or $1,200 per annum.
Peri Data
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U-Shaped Immigration
Immigration - at worst - produced one
seventh of the gap between low skill and
high skills
Importance of Skill Complementarities
Giovanni Peri Presentation
Minutemen and Lou!
• Minutemen
• Lou!
Migration and
Security
• All of the 9/11 attackers entered US
through migration schemes.
• But most of the attacks in Europe have
been by 2nd generation immigrants.
• Restrictions on entry have greatly
reduced numbers of foreign students.
• Cost benefit analysis.
Rudolph
• Migration is higher during times of
major security threat because of ‘rally
around flag’: e.g. during Cold War.
• 65% of Americans favored restrictions
in 1993 compared to 42% in 1977.
Prop. 187 passes in CA in 1994.
Migration post 9/11
• 65% of Americans post 9/11 wanted to
stop ALL immigration (Fox News).
• Mexicans as ‘terrorists’ (see
Minutemen)
• Fingerprints for visitors. EBSVERA
(2002)
Migration Elsewhere
Education of Migrants
Unemployment
Migration and
Diversity
• Jan Nederveen Pieterse argues that
globalization is creating diversity and
‘hybrid cultures’ rather than a McWorld.
• Is this driven by migration or trade?
• Can we import culture without importing
people?
Effects of
Globalization on the
Welfare State
• NEGATIVE: Ability of citizens to move
and businesses to leave means taxes
must be kept low.
• POSITIVE: Volatility caused by trade
shocks and capital flows means citizens
demand ‘protection’ from the state.
Trade and Finance
(Garrett)
• Collision Course vs. Virtuous Circle
• Argues that despite increased trade and
capital mobility since 1960,
governments are able to sustain heavy
budget deficits and to tax capital at high
rates.
• Consequently, the welfare state is
unlikely to be ‘harmed’ by globalization
Trade
Finance
Public Spending
Taxation of Capital
Effects of Migration
on
Welfare
State
• Borjas argues that OECD states are ‘welfare
magnets’ attracting migrants. Shows that
immigrant welfare recipients cluster in high
welfare US states.
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Razin and Sadka show that where pension
systems are large, welfare state may be
supported by migration, even of low skilled
workers.
Europe and US thus face different impact on
welfare state of migration.
Labor in the Developing
World
• Why do we see migration if trade is
good for the poor in the developing
world? Can trade substitute for
migration?
• Longstanding argument about whether
unskilled in developing world benefit
from trade or lose out.
• Are sweatshops and child labor good or
bad things?
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Does Labor Benefit?
(Rudra)
Nita Rudra argues that H/O model predicts that
unskilled labor in developing world should benefit
from globalization.
If economic power translates into political power,
they would advocate for government spending.
But such spending is low. Why?
Rudra creates Potential Labor Power (PLP) index
which measures (a) strength of unions, and (b)
‘reserve’ army of informal sector. Without PLP,
workers, though richer, cannot gain political
goals.
Two Cheers for
Sweatshops
• Sweatshops are certainly very harsh
• But...
1. Are preferable jobs attainable?
2. Can sweatshop jobs act as a first step
to better conditions?
‘Dying for Growth’?
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Millen and Holtz argue that MNCs subcontract
to local firms that violate labor laws and pay low
wages.
Export Processing Zones are often made
exempt from labor laws
Lax environmental regulation is also
problematic. Maquiladoras receive raw
materials from USA but fail to repatriate waste.
Ends up in Mexico.
D’Mello and Reebok
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Concept of ‘manufacturing without
factories’
Focuses on Reebok’s subcontractor
Phoenix International near Delhi. Sexual
abuse, beatings, forced overtime.
Labor organization and strike lead to
Reebok ending its contract.