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Presentation on theme: "Main."— Presentation transcript:

1 main

2 World Population: 6,853,328,460 Migrants in the world: 215,738,321
According to the International Organization for Migration's World Migration Report 2010, the number of international migrants was estimated at 214 million in If this number continues to grow at the same pace as during the last 20 years, it could reach 405 million by 2050.  World Population: 6,853,328,460 Migrants in the world: 215,738,321 Almost 3.15% of the world population live outside their countries  Migration

3 International migration
International migration will play an increasing role in the demographic future of nations if fertility continues to decline in most countries. Net immigration already accounts for roughly 40% of population growth in the United States of America and about 90% in the EU-15 countries International migration

4 International Labour Migration
International labour migration is defined as the movement of people from one country to another for the purpose of employment. Labour mobility has become a key feature of globalization and the global economy with migrant workers earning US$ 440 billion in 2011, and the World Bank estimating that more than $350 billion of that total was transferred to developing countries in the form of remittances. International Labour Migration

5 Migration from Ukraine
Recently, Ukraine has become one of the major labor exporting countries in Europe. Rough estimations of the workforce that has at some time worked abroad about 7 million people, which is a lot in any case for Ukraine with its work-capable population of about 28 million. Migration from Ukraine

6 Top migrant destination

7 Top emigration countries

8 Top migration corridors

9 Migration's costs & risks
In countries, which do not share a long and porous border with the destination country and do not have extensive networks leading to low-skilled jobs there, international migration is more costly and risky. This precludes much emigration from the low end of the skill distribution, leaving a predominance of brain-drain migrants at the top. Migration's costs & risks

10 Theories of migration try to explain what drives population flows.
Given the complex nature of the decision process individuals face, there is a large variety of theoretical models available to explain the actual migration outcome. These models may either be classifed as micro- or macroeconomic in nature. While micro behavioural models focus on dominant factors at the individual level (such as the human capital model), macroeconomic models especially focus on the labour market dimension of migratory flows. Theories of migration

11 Neoclassical migration theory
The neoclassical migration theory starts from an expected income (utility) maximization approach. The human capital model of migration in fact views the process of migration as an investment where the returns to migration (in terms of higher wages associated with a new job) exceed the costs involved in moving. From this follows that the humans compare the expected income they would obtain for the case they stay in their home region (X) with the expected income they would obtain in the alternative region (Y) and further accounts for 'transportation costs' of moving from region X to Y. Neoclassical migration theory

12 Selectivity of migration
Thus, neoclassical economic theories of labor migration posit that individuals situate themselves in the labor market and jobs where their expected earnings (net of migration costs) are highest. Earnings are the product of wages and time worked, both of which depend on education and other “human capital” characteristics of individuals. Other considerations affecting individuals’ satisfaction or “utility” at different locales (e.g., proximity to family members, relative deprivation, family income risk) also affect migration propensities in neoclassical models. The association between characteristics of individuals and their likelihood of migrating is frequently referred to as the “selectivity” of migration. Selectivity of migration

13 Human capital as the factor of migration
Social science research on the determinants of migration using household level data generally find that human capital (e.g., education) is positively related to the likelihood of out-migration. The selectivity of migration on individual and household characteristics varies across migrant destinations. It depends critically on the returns to these characteristics in different migrant labor markets. For example, in most cases, average schooling levels for immigrants in the U.S. are substantially above those of their countries of origin. This finding reflects higher economic returns to schooling in the U.S. compared to places of origin as well as other potential migrant destinations (e.g., urban areas in migrants’ countries of origin). It also has implications for development. If migrants take (human) capital with them when they migrate, this may have detrimental effects on the productivity of workers left behind. Human capital as the factor of migration

14 The Lewis dual economy consists of a "capitalist" sector and a "non-capitalist" sector.
Although Lewis did not intend this, in practice the capitalist sector has generally become identified with the urban economy and the non-capitalist sector with agriculture or the rural economy. Sir W. Arthur Lewis Though neoclassical two-sector models originally designed to examine the reallocation of labor between rural and urban areas, it is potentially applicable to international migration. Lewis dual economy

15 Profit Capitalist sector Labor Subsistence sector
The capitalist sector hires labor and sells output for a profit, while the non-capitalist (or subsistence) sector does not use reproducible capital and does not hire labor for a profit. Initially, labor is concentrated in the non-capitalist sector. As the capitalist sector expands, it draws labor from the non-capitalist sector. If the capitalist economy is concentrated in the urban economy, labor transfer implies geographic movement, i.e., rural-to-urban migration. Profit Capitalist sector Labor Subsistence sector Dual economy

16 Opportunity cost for the rural economy
In theory, migration implies an opportunity cost for the rural economy, which loses the product of the individuals who migrate. However, the centerpiece of the Lewis model (and essence of the classical approach) is the assumption that labor is available to the industrial sector in unlimited quantities at a fixed real wage, measured in agricultural goods. Opportunity cost for the rural economy In the limiting case, this implies that there is surplus or redundant labor in rural areas, such that the marginal product of rural labor is zero, and labor thus may be withdrawn from rural areas and employed in the urban sector without sacrificing any loss in agricultural output. That is, the opportunity cost or "shadow price" of rural labor to fill urban jobs is zero. Opportunity cost for the rural economy

17 Key hypothesis of the Lewis model
More generally, the labour supply from the subsistence sector is unlimited if the labour supply is infinitely elastic at the ruling capitalist-sector wage. In the Lewis model, earnings at the prevailing capitalist-sector wage must exceed the non-capitalist-sector earnings of individuals willing to migrate. Any tendency for earnings per head to rise in the non-capitalist sector must be offset by increases in the labor force there (e.g., through population growth, female labor-force participation, or immigration). A key hypothesis of the Lewis model is that rural out-migration is not accompanied by a decrease in agricultural production nor by a rise in either rural or urban wages. W L Key hypothesis of the Lewis model

18 According to Ranis and Fei’s interpretation of the Lewis model, the perfectly elastic labor supply to the capitalist sector ends once the redundant labor in the rural sector disappears and a relative shortage of agricultural goods emerges. Through migration, the marginal value products of labor are equated between the two sectors. Here the Lewis classical approach ends and the neoclassical analysis starts. The dual economies merge into a single economy in which wages are equalized across space. Assuming full employment of labor in both rural and urban sectors and minimal transactions costs, inter-sectoral wage differentials should be the primary factors driving rural out-migration. Gustav Ranis & John Fei

19 Rural-to-Urban Migration
Rural-to-urban migration exerts upward pressure on wages and on the marginal value product of labor in rural areas, while putting downward pressure on urban wages. W W migration Labor drawn L L Rural-to-Urban Migration Rural sector Urban sector Rural-to-Urban Migration

20 Internal and international migration are modeled according to this perfect-markets neoclassical specification in virtually all computable general equilibrium models, both national and international. In contrast, most microeconomic models of rural out-migration are grounded on Todaro's seminal work, which incorporates labor-market imperfections, including urban unemployment, into a migration model. Michael P. Todaro Michael P. Todaro

21 Todaro proposed a modification of the neoclassical migration model in which each potential rural-to-urban migrant decides whether or not to move to the city based on an expected income maximization objective. Expected urban income at a given locale is the product of the wage (the sole determinant of migration in the neoclassical models), and the probability that a prospective migrant will succeed in obtaining an urban job. Expected rural income is calculated analogously. Individuals are assumed to migrate if their discounted future stream of urban-rural expected income differentials exceeds migration costs; i.e., if is the probability of urban employment at time t, is migration costs, denotes urban earnings given employment, is the discount rate. represents expected rural earnings at time t, Michael P. Todaro

22 Share of rural population & GNP pc
Among nations, the share of rural population declines sharply as per-capita incomes increase, from 70 to 80% in countries with the lowest per-capita GNPs to less than 15% in the highest-income countries. Share of rural population & GNP pc

23 The share of the national workforce in agriculture
The share of the national workforce in agriculture plunges even more sharply, from 90% or higher in low-income countries to less than 10 % in high-income countries. The share of the national workforce in agriculture

24 Foreign seasonal agricultural service workforce
In the United States an estimated 69 % of the 1996 seasonal agricultural service workforce was foreign-born, and in California, the nation's largest agricultural producer, more than 90 % of the seasonal agricultural service workforce was foreign-born. Foreign seasonal agricultural service workforce

25 World migrations out of rural areas
The world's great migrations out of rural areas are accelerating. The most populous countries also are among the most rural. The greatest migration potential is in China, where 71 % of the population is rural and an estimated one-third of the rural labor force of 450 million is either unemployed or underemployed. World migrations out of rural areas

26 Human Capital Theory and Migration
Human capital models of migration represent an effort to provide the migration theories presented above with a micro grounding, permitting tests of a far richer set of migration determinants and impacts. The predictions of Human capital migration theory Human Capital Theory and Migration

27 The predictions of Human capital migration theory
First, the young should be more mobile than the old, inasmuch as they stand to get returns from migration over a longer period of time. Second, migration between locales should be negatively related to migration costs. This has been interpreted as implying a negative association between migration flows and distance. However, considerations besides distance (especially access to information) may make distance less of a deterrent for some individuals (e.g., better-educated individuals or those with "migration networks", contacts with family or friends at prospective migrant destinations). The predictions of Human capital migration theory

28 The predictions of Human capital migration theory
Third, neutral productivity growth in an economy - e.g., equal rates of growth in the rural and urban sectors - will increase migration from low-income (e.g., rural) to high-income (e.g., urban) sectors or areas. Fourth, specific human capital variables that yield a higher return in region A than in region B should be positively associated with migration from B to A. In addition to these predictions, human capital theory implies that income differentials between rural and urban areas are eliminated by migration over time. The predictions of Human capital migration theory

29 Equilibrium model of migration
Labor Migration If the countries are closed, there are no migration flows W W emigration immigration L L Country A Country B Equilibrium model of migration

30 Migration not only produces lost-labor, and possibly also lost-capital, effects on rural economies. It also represents a potentially important source of income and savings, through migrant remittances. Non-migrants benefit from emigration, even if they do not receive any of the remittances themselves, provided that the magnitude of migrants' remittances exceeds a critical threshold roughly equal to the value of the production they would have produced had they stayed behind. Measuring remittances is difficult because migrants often enter developed countries outside of official channels and repatriate their earnings through informal means. Money may be returned in the form of goods purchased abroad or in the form of cash savings brought back by migrants or visiting family members ("pocket transfers"). Migrant remittances

31 The Modern Approach to analysis of Migration
Causes of migration Impacts of migrations on sending countries Analysis of migrations on receiving countries in migrants and their families TOWARDS AN ASSESSMENT OF MIGRATION, DEVELOPMENT AND HUMAN RIGHTS LINKS: CONCEPTUAL FRAMEWORK AND NEW STRATEGIC INDICATORS The Modern Approach to analysis of Migration

Economic impacts of remittances Impacts of return migration Social costs of reproduction (human capital) Demographic impacts Demographic impacts Social and cultural impacts Political impacts IMPACTS ON SENDING COUNTRIES

33 Causes of migration Economic asymmetries between sending and receiving countries Social inequalities between sending and receiving countries Relative economic productivity between sending and receiving countries Human development index GINI coefficient Differences in economic growth Gender inequalities Wage differentials Labor precariousness in sending and receiving countries Deficit or surplus in labor force Gaps in research and development investments Causes of Migration

Economic impacts Impacts on national security Demographic impacts Social and cultural impacts IMPACTS ON RECEIVING COUNTRIES

Economic impacts Impacts on labor conditions Impacts on human rights Social and cultural impacts IMPACTS ON MIGRANTS AND THEIR FAMILIES

36 THE END The end

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