1. ECON3315 International Economic Issues
Instructor: Patrick M. Crowley
Issue 6: Immigration

2. Overview Migration – what is it? Why do people migrate?
Where do they migrate to?
Migration statistics
Migration – is it desirable?
Legal vs illegal migration
Economic effects of migration
“East Europe migrants help take jobless to six-year high”
(Headline in the UK Daily Mail, 17 August 2006)

3. Migration – what is it?
Labor migration can occur within a country, or between countries
International migration can occur for reasons of religious persecution, political beliefs, war, following other members of the family, or for economic reasons
When international migration for economic reasons occurs, it is mostly between developing/transition countries and developed economies
Some migration occurs legally, and some illegally. In the EU, migration can occur legally between all member states, although some CEEC had limitations. This is one of the major causes of the UK deciding to exit the EU.
Roughly 3% of the world’s population lives outside it’s country of birth – not a lot when you think about it.

4. Why do people migrate?
People migrate for economic & demographic, political and social and cultural factors
There are both push and pull factors

5. Where do they migrate to?
Often migration occurs to a specific country because of
i) perceived jobs available in that country
ii) family members already resident in that country
iii) wage differentials being large with that country
iv) reasons of language and culture
v) geography
These patterns can be seen by looking at destination countries and where migrants predominantly come from

6. Immigration inflows

9. Destinations for migrants

10. South-south immigration as important as north-north immigration

11. Immigration – Economic questions
Q: Has migration led to unemployment?
A: No – not unless you count unemployed migrants
Q: Has migration driven down wages?
A: Depends on sector – results mixed
Q: Does migration cost the taxpayer?
A: Short term, yes; Long term, no
Q: Does migration damage developing countries?
A: Skilled labor, yes; non-skilled, no; remittances
Q: Does migration hurt migrants?
A: Depends on skill levels – 20% return home…
See:

12. International migration is nothing new…it has just become more politically charged in the US…

13. Migration statistics
So, as of 2000, US had the largest stock of international migrants, but…

14. Migration statistics
…it didn’t even register on the list of countries with the largest % of migrants

15. Migration: is it desirable?
Migration is desirable, particularly if it brings certain skills to the work force of the recipient country.
So it is important to know the skill set that migrants have…

16. Migration: is it desirable?
Migrants are on average more educated and less educated than the resident population

17. Migration – is it desirable?
Presumably, legal immigration is desirable as long as the migrants can find/get gainful employment….

18. Legal vs illegal immigration
This is a complex issue, particularly in the US and EU.
Governments try to curb illegals

19. Case study: EU migration
The number of migrants claiming asylum in the EU has skyrocketed in 2015

20. 2015 EU migration Where are these migrants coming from?
In most cases, those coming from Kosovo, Albania and Serbia are economic migrants and are usually denied residency and given a plane ticket back home

21. 2015 EU migration
Largest migration flows coming from Central and Eastern Mediterranean
West Balkans also seen large flows into Eastern Europe – but most of these are classified as economic migrants

22. 2015 EU migration The potential scale of the problem is large
With both US, Syrian government bombing and Russian bombing, the problem is only likely to get worse.

23. 2015 EU migration Quotas were agreed upon for taking refugees
Some EU member states have opted out though
Response is clearly inadequate

24. Economic effects of migration
Economic theory suggests that if migration were zero cost and also legal to everywhere, then wages across countries would equalize
So unless there is excess demand for labor in a certain industry, by increasing labor supply, ceteris paribus, there will be some downward pressure on wages.
Effect should also increase wages in country of origin
There is some evidence of this happening in certain industries in the US, but it is not widespread
Also migrant remittances back to the origin country – Mexico is a particularly large recipient (then India, Philippines, Morocco, Egypt)

25. Migrant remittances