International migration,non-traded goods and economic welfare in the source country

"This paper examines the economic effects of emigration in a source country producing both traded and non-traded commodities. It is shown that, even if the economy faces fixed terms of trade, emigration can still affect the welfare of the non-migrants, and the direction of the effect in this context will always be negative." The focus is on migration from developing countries.     

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."     

Social norms and the fertility transition

This paper provides a norm-based explanation for two features of the fertility transition that have been observed in many different settings: the slow response to external interventions and the wide variation in the response to the same intervention. Most societies have traditionally put norms into place to regulate fertility. When the economic environment changes, individuals gradually learn through their social interactions about the new reproductive equilibrium that will emerge in their community. This characterization of the fertility transition as a process of changing social norms is applied to rural Bangladesh, where norms are organized at the level of the religious group and interactions rarely cross religious boundaries. Consistent with the view that changing social norms are driving changes in reproductive behavior in these communities, we find that the individual's contraception decision responds strongly to changes in contraceptive prevalence in her own religious group within the village whereas cross-religion effects are entirely absent. Local changes in reproductive behavior occur independently across religious groups despite the fact that all individuals in the village have access to the same family planning inputs.     

International migration,non-traded goods and economic welfare in the source country: a comment

"Labor emigration redistributes income in a two factor, two good economy where one good is internationally non-traded. Labor's nominal wage rises as nominal capital payments fall. Recent research has shown that the prices of non-traded goods rise, causing society's welfare to decline. Here the induced change in the real income of each factor is considered separately. There is an ambiguity with regard to the real income of non-emigrating labor. If labor spends a relatively small fraction of income on the non-traded goods, its real income may rise, even though society suffers the loss of welfare."     

Endogenous fertility, international migration and growth

An endogenous growth model with heterogeneous agents and endogenous rates of fertility is developed to study the relationships between population growth, human capital, migration and economic development. A variety of patterns of migration, from the migration of the unskilled to the brain drain is considered, where the decision to migrate reflects the agents’ optimising behaviour. The analysis yields implications which accord with the empirical evidence on the relationships between demography and development. Macroeconomic policy can foster growth by influencing labour mobility through taxation and the provision of public goods such as social infrastructure, sanitation, environmental control and medical research that affect locational preferences and child quality. The author is grateful for the comments of an anonymous referee on an earlier version of the paper. The usual disclaimer applies.     

Return migration and the transfer of gender norms: Evidence from the Middle East

Does international return migration transfer gender norms? Focusing on Jordan, an Arab country where gender inequality and emigration rates are high, this paper exploits unique data in which detailed information on female empowerment allows us to construct several measures of social norms in Jordan on the role of women, female freedom of mobility, and female decision-making power. Controlling for both emigration and return migration selections, we find that women with a returnee family member are more likely to bear traditional gender norms than women in households with no migration experience. Further analysis shows that results are driven by returnees from more conservative Arab countries, suggesting a transfer of conservative norms from destinations with highly traditional gender roles. We also show the implications of our results beyond perceptions for several economic and development outcomes, such as female labour force participation, education and fertility.     

No country for young men: International migration and left‐behind children in Tajikistan

This paper investigates the effects of international migration on the schooling and labour outcomes of left‐behind children in rural Tajikistan. Using three‐wave panel survey data, I rely on an instrumental variable strategy to address the non‐random selection into migration. I identify important and gender‐differenced schooling and labour supply responses. My findings suggest that boys living in migrant households are less likely to lag behind at school or work. At the intensive margin, they also report fewer hours of work per week. On the other hand, left‐behind teenage females undertake a higher number of domestic chores. They appear to marry earlier as well. The migration impact on boys appears to be driven by remittances and the improved financial situation of households. The absence of any positive influence on the education of left‐behind girls is likely to be explained by Tajikistan's cultural norms and institutions.     

Institutions, social norms, and decision-theoretic norms

This article attempts to contribute to the debate on how to define and theorize institutions, particularly regarding normativity and explanations for conformity. Firstly, it proposes some distinctions and concepts: it separates moral from epistemic values, leading to different types of legitimacy and social norms; then it distinguishes different meanings of the term ‘normative’ and introduces the concept of decision-theoretic norm. Secondly, the article defends a broad concept of institutions by arguing that some institutions are neither social norms nor decision-theoretic ones, a point that matters for institutional change and stability. Some conventions from which innovators break are highlighted as an example.     

Investment opportunities in the source country and temporary migration

Abstract This paper examines how attractive investment opportunities available to temporary migrants at home affect their saving behaviour and the optimal duration of stay abroad. The model predicts an inverse U‐shaped relationship between migration duration and the expected rate of return on repatriated savings. A higher rate provides an incentive to go back earlier and consume less abroad, while it can also trigger emigration aimed at generating the savings required for investment after return. The paper illustrates how the behaviour of temporary migrants reflects the interaction between their preferences and the opportunities available in labour and capital markets of both countries.     

Migration between home country and diaspora: an economic analysis

"This paper investigates the distribution of a population group between a home country and diaspora, given sequential decision-making regarding migration at the individual level. The home country is attractive to the members of the group, yet their presence there requires a fixed amount of public spending (e.g., on defense). The per-capita tax burden depends then on the size of the domestic population, reflecting a case of ?fiscal externality'. This results in an inefficient distribution of the group between the home country and the diaspora. Encouraging immigration to the home country is an interest not only of those individuals who are currently in the home country but also of those residing in the diaspora. However, only when the burden of public spending in the home country is large enough do the latter volunteer to bear part of it. Even then, in general, this part is smaller than socially optimal."     

International migration,remittances and welfare in a dependent economy

This note extends the work of Rivera-Batiz (1982) in an attempt to examine the role of remittances in determining the effects of migration on the welfare of the remaining residents in a small open economy producing both traded and non-traded goods. It is shown that if the flow of remittances exceeds a certain critical amount, the remaining residents benefit from migration even if they do not receive any of the remittances themselves. This is in sharp contrast with the results of the Rivera-Batiz model in which the possibility of a gain for the non-migrants is ruled out.     

International migration,remittances, and schooling: evidence from El Salvador

We examine the effect of remittances from abroad on households' schooling decisions using data for El Salvador. Following the massive war-related emigration of the 1980s, remittances became a significant source of household income throughout the 1990s. We use the Cox proportional hazard model to examine the determinants of school attendance. Measuring income from a source that is uncorrelated with parental schooling—remittances—, we find that remittances have a large, significant effect on school retention. We estimate that while household income net of remittances has a small, though significant, impact on the hazard of leaving school in rural and urban areas, remittances have a much larger impact on the hazard of leaving school. In urban areas, the effect of remittances is, at its smallest, 10 times the size of the effect of other income. In rural areas, the effect of remittances is about 2.6 times that of other income. Our finding is of interest in that it suggests that subsidizing school attendance, particularly in poor areas, may have a large impact on school attendance and retention, even if parents have low levels of schooling.     

A note on international migration,non-traded goods and economic welfare in the source country

"This note extends the work of Rivera-Batiz to the case where capital is collectively owned and the decision to emigrate entails both a withdrawal of labor services from the source-country and the surrender of the ownership of capital. In this framework, which seems to have wide real-world relevance for socialist, labor-managed and peasant economies, it is found that emigration helps increase the welfare of the non-migrant. This result, which seems quite robust to its specifications, is exactly the opposite of that of Rivera-Batiz and points to the need for great caution in drawing policy conclusions with regard to issues pertaining to emigration."     

International migration,foreign direct investment,and development stage in developing economies

The existing empirical results on the relationship between FDI and migration are rather mixed. This study reevaluates, both theoretically and empirically, how inward FDI relates to emigration in developing countries. Our model illustrates that the relationship between inward FDI and emigration flows depends on the development stage of a developing country, that is, there is a positive association between inward FDI and emigration flows for relatively less‐developed countries but a negative association between these two variables for relatively developed countries. We confirm the empirical validity of our model prediction using the panel data of 21 OECD and 51 non‐OECD countries during the period from 2003 to 2012. Our results argue that as economic development proceeds in a developing country, the home effect of inward FDI associated with intensified labor demand would dominate the linkage effect that induces the brain drain problem through enhancing the socioeconomic ties with migrant networks.     

International migration and the welfare state revisited

Immigration is a controversial topic in most developed economies. The presence of a redistributive welfare state in all major immigrant host countries creates a margin on which immigration affects native welfare. The primary focus of the paper is whether a large intake of immigrants reduces welfare state effort. It is usually argued that steady increases in immigration lead to public pressure for lower levels of publicly-funded social expenditures. In contrastz to the earlier empirical literature on this topic, we find little evidence in favour of this hypothesis. While immigration does have a relatively modest effect on the welfare state, if anything there is some support for the view that a greater influx of immigrants has lead policy-makers to increase welfare state spending.     

International Migration,remittances and income distribution in the source country: a synthesis

The paper explores, under a wide variety of circumstances, the welfare impact of emigration. The analytical framework posited is a simple two-factor, two-commodity, two-class general equilibrium model that makes a distinction between traded and non-traded goods. The principal aim is to collect and synthesize the well-known results in the literature, derived from diverse analytical frameworks, as well as to establish a number of new ones. It is shown that pure emigration can be beneficial to the non-emigrants in the source country, irrespective of the welfare criteria adopted, if accompanied by sufficient remittances. The paper also highlights the fact that emigation does not affect all classes in society symmetrically. The division of losers and gainers depends on the volume of remittances, the distribution of factor endowments and the type of emigration.     

Social norms,cooperation and inequality

This paper analyzes the outcomes that can be supported by social norms in a society of infinitely lived and patient agents that are randomly matched in pairs every period to play a given game. I find that any mutually beneficial outcome can be supported by a self-enforcing social norm under both perfect information and a simple local information system. These Folk Theorem results explain not only how social norms can provide incentives that support cooperation in a community, providing support to the concepts of social capital and corporate culture, but also how they can support inequality and discrimination.I am grateful to David Levine for invaluable guidance and ideas. I also thank Anna Aizer, Hongbin Cai, Walter Cont, Ernesto Dal Bó, Jean-Laurent Rosenthal, Federico Weinschelbaun, William Zame, anonymous referees and seminar participants at Universidad de Buenos Aires, UCLA, Universidad T. Di Tella, Harvard Business School and Stockholm School of Economics for very useful comments and discussions     

International migration and “educated unemployment”

This paper provides a novel explanation of “educated unemployment”, which is a salient feature of the labor markets in a number of developing countries. In a simple job-search framework we show that “educated unemployment” is caused by the prospect of international migration, that is, by the possibility of a “brain drain”. In addition, the analysis shows that a developing country may end up with more educated workers despite the brain drain and educated unemployment.     

The influence of rapid rural-urban migration on Korean national fertility levels

A autoregressive model is applied to personal migration and pregnancy histories recorded in the 1974 Korean World Fertility Survey to assess the adaptation effect of rural-urban migration on migrant fertility and national fertility levels. The objective of this study is to provide policy makers in developing nations with a model that will enable them to quantify the effects of rapid urbanization on the fertility level of migrant women and thus on national fertility levels. The fertility of rural-urban migrants is on the average lower than that of rural stayers; this study supports the adaptation hypothesis and indicates that rural-urban migrants experienced a significant reduction in 5 year fertility rates from those of comparable rural stayers after migration to the urban area. In addition, the city specific effects of migration on fertility are of considerable importance; migrants to larger cities adapt more over their lifetime than migrants to smaller cities. The completed adaptation by postmarital, rural-urban migrants is largest among migrants who are least educated. The autoregressive model controls the fertility level at the beginning of the observed period; it is assumed that this is a proxy for family size preferences. Results show that the completed fertility of migrant women with less than 4 years of school is 1.9 children fewer than that of comparable rural stayers, 1 child fewer for migrant women with 4 to 6 years of school, and .8 children fewer for migrant women with at least 6 years of school. For Korea, the overall effects on national fertility of rural-urban migration represent a reduction of 1.79 births per woman for the 1965-1970 period; it is estimated that the 945,400 rural-urban women migrants of this period would avoid, on average, 71,300 births annually for their expected average 24 years of urban life.     

International migration,economic policy and human capital accumulation: a simulation study

"This paper examines the economic policy implications of international migration and human capital accumulation within a dynamic general equilibrium model. Each country produces by means of physical and human capital of two types (skilled and unskilled labour). Along optimal growth paths in a world of diverging population growth rates immigration can only be beneficial when the free rider effect (i.e., not paying for training costs) exceeds the capital dilution effect of an increase in population growth. Under quite general conditions the optimal immigration rate is zero."