Demographic and Economic Pressure on Emigration out of Africa*

Two of the main forces driving European emigration in the late nineteenth century were real wage gaps between sending and receiving regions and demographic booms in the low‐wage sending regions. Our new estimates of net migration for the countries of sub‐Saharan Africa show that exactly the same forces driving African across‐border migration are at work today. The results suggest that rapid growth in the cohort of potential young emigrants, population pressure on the resource base, and slow economic growth are likely to intensify the pressure for migration out of Africa and into high‐wage OECD countries over the next two decades.     

“I even met happy gypsies”

Economic studies of the Roma population, which is the largest and the poorest ethnic minority in Europe, remain sparse due to the limited availability of appropriate micro level data. This paper provides a comparative analysis of life satisfaction between Roma and non‐Roma young adults aged between 15 and 24 years using survey data collected from Serbia in 2010 and from Bosnia and Herzegovina in 2011. Results from raw answers show that the young Roma population living in settlements is less satisfied with life than non‐Roma. However, we find instead that the former group is more satisfied once we account for the fact that Roma have more disadvantaged characteristics on average. Also, Roma young adults expect a better life within one year compared to the non‐Roma in Serbia while there is no difference in Bosnia and Herzegovina.     

Emigrants’ missing votes

What are the causal effects of emigration on election outcomes in the country of origin? Large emigration of high-skilled emigrants can lead to changes in the distribution of political preferences, which affect voting outcomes. Using administrative migration and voting data, we show that emigration from Poland following its accession to the European Union in 2004 caused an increase in vote shares for right-wing parties, while decreasing the vote share for left-wing parties due to emigrants’ missing left-leaning votes. To account for endogenous migration patterns, we construct an innovative instrument that measures the distance to the closest open EU border. Our results highlight that emigration enhances stayers’ trust in right-wing governments and increases stayers’ voting for parties with pro-European positions. Exploiting a change in voting rules over time allows to disentangle different mechanisms. These results have important implications for the design of voting policies.     

The fiscal impact of high-skilled emigration: Flows of Indians to the U.S.

What are the fiscal consequences of high-skilled emigration for source countries? This paper develops methodologies for inferring these consequences and applies them to the recent sizable emigration of high-skilled workers from India to the U.S. This wave of emigration from India to the U.S. is shown to be unusually concentrated amongst the prime-age work force, the highly educated and high earners. In order to calculate the fiscal losses associated with these emigrants, estimates of their counterfactual earnings distributions are generated using two distinct methods and integrated with a model of the Indian fiscal system to calculate fiscal consequences. Conservative estimates indicate that the annual net fiscal impact to India of high-skilled emigration to the U.S. is one-half of 1% of gross national income (or 2.5% of total fiscal revenues). The sensitivity of these results to the method of predicting counterfactual incomes and the implications of these estimates for other developing countries is discussed in detail.     

Migrant Networks: Empirical Implications for the Italian Bilateral Trade

A significant number of empirical studies, focusing on different countries, have found a positive link between migration and trade. This paper studies the relationship between emigration, immigration and trade using Italian data. The sample regards 51 foreign trading partners and spans from 1990 to 2005. The results suggest that networks of Italian emigrants in foreign countries boost bilateral trade. The effects of immigrants are weak on exports and negative on imports. Results do not change when cultural and institutional dissimilarities between countries are considered.     

Does International Migration Promote Industrial Development? Evidence from Africa 1980–2010

This paper examines mainly how international migration affects industrial development in Africa. Using the migration dataset constructed by Brücker, Capuano and Marfouk in 2013, econometric estimations are implemented on a panel of 45 African countries over the period 1980–2010 based on the generalized method of moment estimators. Our results suggest that on average, emigration affects industrial development in Africa positively and significantly during the period of interest. Both low-skilled and medium-skilled emigrants affect more industrial development. The results also reveal that international financial flows, business networks and scientific networks are the channels through which migration affects industrial development.     

Role of Migration in Pension Integration within the European Union

Although the European Union has made notable steps towards completion of the economic and monetary union, fiscal convergence, banking union and capital markets union, potential integration of pensions and social security has not advanced as much. As the European Union countries have experienced increased migration/refugee flows over the last decade, the question is whether migrants/refugees can influence the adequacy of member-state pension schemes and potentially allow for a Pan-European Pension Plan. Consequently, the purpose of this paper is to investigate, as a prelude to pension integration, whether immigration and emigration affect pension assets, liabilities, and the asset-liability gap and to identify the determinants of this gap. Using generalized method of moments estimation, evidence is found that increases in immigration and decreases in emigration (as a percent of the population) lead to an increase in the assets of autonomous pension funds. Analogously, increases in valid permits (as a percent of the population) and decreases in unemployment (as a percent of the labor force) result in a decrease in liabilities (benefits) of autonomous pension funds. The novelties of this study are the identification of factors that affect pension assets, liabilities and the asset-liability gap at a country level and the contribution of immigration from non-EU countries to closing the asset-liability gap. The findings can be used to draft pension and migration policies at a pan-European level.

     

On the test score gap between Roma and non‐Roma students in Hungary and its potential causes

Using unique data from Hungary, the gap in reading and mathematics test scores between Roma and non‐Roma 8th grade students is assessed and a substantial gap between them revealed. Standardized test scores as well as the fraction of students with competences considered inadequate are examined. Regardless of measurement and subject area, the bulk of the gap is explained by social differences in income, wealth and parental education. Using reduced‐form regressions, two major mediating mechanisms are identified: first, on average the home environment of Roma children is less favourable for cognitive development; second, the educational environment of the average Roma student is different from the average non‐Roma student. Comparing students with similar home environments from the same school and class, the ethnic gap in test scores is found to be insignificant. Ethnic differences in the home environment are explained by social disparity, and ethnicity seems to play no additional role in that regard. The unequal distribution of Roma students in schools and classes is found to be explained predominantly by social difference, too, with a significant residual portion, indicating the effect of ethnic segregation.     

Value Diversity and Regional Economic Development

We investigate the link between culture and regional economic development within European countries. Considering a variety of cultural values, we provide evidence that it is the degree of diversity in these values at the regional level that strongly correlates with economic performance, rather than the prevalence of specific values. In particular, we show that greater value diversity is negatively associated with regional economic performance within countries, which also relates to lower institutional quality and poorer public goods provision. These patterns are robust even when diversity is measured on the basis of values expressed by emigrants residing outside their region of origin.     

Do Potential Skilled Emigrants Care about Political Stability at Home?

In this paper, we consider the role of political stability in the source country as a potential reason for skilled emigration. We control for all prospective source country characteristics, and yet skilled emigration is seen to be driven by a relatively better situation of political stability in the home country. Our research clearly shows that government stability, socioeconomic conditions, investment profiles, democratic accountability, internal conflict, and ethnic tensions in source nations have significant impacts on the rate of skilled emigration for a sample of developed and developing countries. The results retain robustness even for a subset of only developing nations.     

Emigration intentions in a post-conflict environment: evidence from Bosnia and Herzegovina

In this study we analyse intentions to emigrate from Bosnia and Herzegovina (BiH), focusing not only on typical individual and household determinants, but also on post-conflict specific influences. We investigate cross-sectional survey data collected over the period from 2002 to 2010. Our findings indicate that higher intentions for emigration are indeed linked to the typical individual and household conditions: the young, educated and low-family income respondents report the highest intentions to emigrate. In addition, the post-conflict environment characterised by economic and political instability, as well as by conflict and post-conflict related migration, increases these intentions further, both independently and in different combinations. Although determinants such as employment status, household income and perception of economic development are relevant, their effect is of second-order importance. This contradicts the conventional thinking that economic factors are the main driving forces of emigration intentions. We provide evidence that the conflict and post-conflict related migration experiences, and the political situation, may surpass individual and societal economic influences in importance.     

International migration,remittances and real incomes: effects on the source country

"This article deals with the impact of remittances from emigrants on real incomes for different groups in their country of origin in a two-by-two model with one traded and one nontraded good. It is shown that emigration does not necessarily raise the real income of the emigrants themselves. If the traded good is capital intensive, nonmigrant workers gain and capitalists lose, whereas if it is labor intensive, the outcome depends on what happens to the price of the nontraded good. The result of a rise is that capitalists gain and workers lose, while a fall has the opposite effect."     

The macrodynamics of international migration as a sociocultural diffusion process. Part A: theory

"This study formulates a model of the macrodynamics of international migration using a differential equation to capture the push-pull forces that propel it. The model's architecture rests on the functioning of information feedback between settled friends and family at the destination and potential emigrants at the origin." The author tests the model using data on Greek emigration to the United States since 1820 and on total emigration from Cyprus since 1946.     

Ethnic patterns of returns to education in Bulgaria

It is widely accepted that disparities in education contribute to the poor labour market outcomes experienced by ethnic minority groups and consequently to their poverty. In this article, I analyse differential educational benefits in Bulgaria and compare returns to education for the Roma minority with the majority population and the Turkish minority. I show that both ethnic minority groups have lower education levels and employment rates than the majority population and that they also have lower returns to education. This result could be related to minorities' lower education quality as well as to discrimination in the labour market. Integration policies should thus aim to improve employability and labour market competence of vulnerable groups starting from school.     

A voluntary brain-drain tax

A major roadblock to the implementation of Bhagwati's proposal to allow developing countries to tax skilled emigrants residing in developed countries (the “brain drain”) is the administrative problems associated with collecting this tax in the absence of developed-country cooperation. This paper provides a partial solution to these problems, involving the tax treatment of emigrants who return to their countries of origin. The tax system is structured so that returning emigrants who previously paid the brain-drain tax face lower tax payments than those who evaded the brain-drain tax. Given the expected value of this tax benefit, emigrants are willing to pay the brain-drain tax. In the basic model, a source country's optimal tax system includes this brain-drain tax and does not distort migration decisions.     

Waves of migration: a new situation

An attempt is made to forecast migration trends affecting those countries that were formerly part of the Soviet Union. "The new migratory trends are characterized by at least three fundamentally important elements: the ouster of the newly arrived population from the social niche that it had recently occupied, emigration from overpopulated regions, and growing emigration beyond the borders of the former Union."     

The brain drain and the world distribution of income

Skilled emigration (or brain drain) from developing to developed countries is becoming the dominant pattern of international migration today. Such migration is likely to affect the world distribution of income both directly, through the mobility of people, and indirectly, as the prospect of migration affects the rate of return to education in both the sending and receiving economies. This migration pattern will therefore affect human capital accumulation and fertility decisions in both the sending and receiving economies. This paper analyzes these effects in a dynamic two country model of the world economy where agents in both countries make optimal fertility and human capital decisions. The implications of the analysis for the world distribution of income are derived in the light of recent empirical findings of the brain drain literature. The analysis shows that the current trend towards predominantly skilled emigration from poor to rich countries may in the long run increase inequality in the world distribution of income as relatively poor countries grow large in terms of population. In the short run however, it is possible for world inequality to fall due to rises in GDP per capita in large developing economies with sufficiently low skilled emigration rates.     

Labor Market Developments in Albania: An Analytical Overview

Rising unemployment and falling living standards are two of the main problems facing policymakers in economies in transition. The case of Albania is distinctive, because high unemployment has been associated with a very large private sector and by far the greatest scale of temporary emigration compared with other transition countries in Europe. The authors develop a model that characterizes the path of unemployment in the presence of temporary emigration. They analyze the emigration decision and the factors that affect registered unemployment emigration, and highlight how changes in flow probabilities between sectors affect the time paths of registered unemployment and emigration.     

SOARING MINDS: THE FLIGHT OF ISRAEL'S ECONOMISTS

The brain drain issue used to revolve primarily around migration from developing to developed countries. In recent years, there is an accumulation of evidence that this is an issue that should interest developed countries as well. Recently published numbers by the European Commission and the Organization for Economic Co-operation and Development indicate a nonnegligible flow of European academics to American universities. This article provides the first case study conducted on the most massive out-migration of academics on record. At a time when Europe and other developed countries have begun to express concern about the phenomenon, the rate of academic emigration from Israel to the United States is already four to six times the European emigration rate. The particular focus here is on the area of economics, in which the exodus of younger academics from Israel coupled with a heightened retirement rate among the older academics has brought Israel's top economics departments—among the best in the world, until now—to the brink. Countries wanting to create conditions for fostering and nurturing the necessary productivity advances underlying economic growth must become aware of how far and how quickly an academic implosion can occur, if left unchecked. The findings brought forth here should help increase the level of this awareness. ( JEL A11, F22, H52, H83, I23, J31, J61, O15)