Economics facilitating travel & migration

he KNOMAD-ILO Migration Costs Surveys (MCS) aim to systematically document monetary and non-monetary costs incurred by migrant workers seeking jobs abroad. The project is a joint initiative by the Global Knowledge Partnership on Migration and Development (KNOMAD), which is hosted at the World Bank, and the International Labor Organization (ILO). The data is also intended to support methodological work on developing a new Sustainable Development Goals (SDG) indicator 10.7.1 to monitor trends in recruitment costs paid by workers, of which the World Bank and ILO are joint custodians. Datasets and documentation for the 2015 and 2016 survey waves are now available on the World Bank’s Central Microdata Catalog. Collectively, the surveys covered over 19 bilateral migration corridors with a total of 5,603 interviewed migrants. The Migration Costs Surveys primarily focused on costs incurred by workers who were recruited in their home countries and received a job offer prior to migrating. On a pilot basis, several migration corridors were also surveyed to account for non-recruited migrants who moved abroad in search of work without prior job offers. In the 2015 dataset, these are limited to workers who migrated to Mexico from Guatemala, Honduras and El-Salvador and in 2016, the relevant corridors are workers who migrated to Italy from multiple African countries and from Central Asia to Russia.

In this paper I research economic, non-economic and the institutional determinants of bilateral migration flows into OECD countries. My contribution to the growing literature is two-fold. First, I explicitly account for the panel structure of migration costs information acquisition, physical costs of the move and social exclusion). Second, building upon Beine et al. (2011b), I proceed with the analysis of determinants of bilateral migration flows disaggregated by educational attainments in the panel data environment. The preliminary results show that the defined cost variables are significant in explaining the volume and composition of the flow of migrants, the result not being sensitive to the model specification. Network effects promote negative self-selection and the quality of migrants positively correlates, while the physical distance, existence of a common language and colonial links between countries are insignificant in explaining the educational composition of migrants. I further conclude that the restrictive and skill selective immigration policies of the major destination countries bias the conventional role of the economic push and pull factors.

The literature on the economics of migration has ignored the role of sending governments in the assimilation of immigrants in host country labor markets. Recent studies show that immigrants do not cut their ties with the homeland. Various actors linked to homelands are involved in this process. In this paper, we present a different perspective, which identifies the possible actions of those actors, and in particular of government institutions, and their impact on the assimilation process. We hypothesize that these actors may influence the assimilation trajectory of their expatriates. The incorporation of these actors into the existing economics literature is discussed in relation to several categories of actions, such as pre-departure training, post-arrival training and naturalization.

The proposed research develops and tests models of individual behavior to provide evidence on the magnitude, causes and consequences of the mass migration between Europe and the US that occurred at the turn of the twentieth century. Underlying the project is the availability of electronic administrative records for 24 million migrants who arrived in the US via Ellis Island between 1892 and 1924, that we have obtained access to. Our earlier work using this data [Bandiera et al. 2011] shows that migration at the turn of the twentieth century was effectively a two-way flow between the US and Europe, rather than a one-way movement from Europe to the US. This insight is what the proposed research agenda seeks to build on. The proposed project will develop and apply economic theory and micro-econometric methods related to core questions in the economics of migration. Our proposal will provide theory and evidence on four broad research themes: (i) the determinants of temporary versus permanent migration, and consequently how each type of migrant is differentially selected; (ii) the behavior and socio-economic outcomes of migrants who endogenously chose to remain in the US; (iii) the impact of mass migration on the labor market outcomes of Americans; (iv) whether institutional change in the US was driven by the nature of selective migration into America and where migrants chose to settle. In consequence, and to return full circle to the original insight from Bandiera et al. [2011] that underlies this research proposal, we ask whether migrants that returned to Europe from the US drove institutional change across European countries at the turn of the twentieth century.

The early development literature documented that the growth path of most advanced economies was accompanied by a process of structural transformation. As economies develop, the share of agriculture in employment falls and workers migrate to cities to find employment in the industrial and service sectors [Clark (1940), Kuznets (1957)]. In the first industrialized countries, technical improvements in agriculture favoured the development of industry and services by releasing labour, increasing demand and raising profits to finance other activities. However, several scholars noted that the positive effects of agricultural productivity on economic development are no longer operative in open economies. In addition, there is a large theoretical literature highlighting how market failures can retard structural transformation in developing countries. In particular, financial frictions might constrain the reallocation of capital and thus retard the process of labour reallocation. In this project, we propose to contribute to our understanding of structural transformation by providing direct empirical evidence on the effects of exogenous shocks to local agricultural and manufacturing productivity on the reallocation of capital and labour across sectors, firms and space in Brazil. For this purpose, we construct the first data set that permits to jointly observe labour and credit flows across sectors and space. To exploit the spatial dimension of the capital allocation problem, we design a new empirical which exploits the geographical structure of bank branch networks. Similarly, we propose to study the spatial dimension of the labour allocation problem by exploiting differences in migration costs across regions due to transportation and social networks.

Highly Skilled Migration and International Flows of Talent, Knowledge, and Capital (TKC) is a project funded by the French National Research Agency (ANR). TKC aims to improve our understanding of whether and how highly skilled migrants activate their social networks and leverage their role as international knowledge gatekeepers, contribute to solve cross-border information problems, and transform the brain drain into brain gain and brain circulation. Highly skilled workers play a key role in today’s knowledge economies, as they introduce and diffuse innovations that encourage economic growth and well-being. Migrants are an essential component of these highly skilled workers worldwide: in 2013, the worldwide stock of migrants stood at 230 million, namely 3.2% of worldwide population (UN-DESA and OECD, 2013). However, important variations emerge across skills’ groups: tertiary educated immigrants living in OECD countries augmented by 70% during the 2000s, with just 10% for low-educated ones. Migration rates for the tertiary educated are higher than for the rest of the population, and generally increase with further education. Thus, differently from the past, highly skilled individuals represent the most dynamic component of international mobility flows. Far from taking place exclusively along a South-North or East-West axis, highly skilled migration occurs also between advanced economies, with the UK, Germany and other European countries as both destinations and origins. Science, technology, and engineering migration contributes heavily to these trends, including to its geographical variation. TKC’s research topic stands at the cross-roads of different disciplinary approaches, ranging from the geography of innovation, the economics of migration, and IB studies. All of them can be re-examined within the general theoretical framework of diaspora economics. Constant and Zimmermann (2016) define diasporas as “well-defined group(s) of migrants and their offspring with a joined cultural identity and ongoing identification with the country or culture of origin”, and propose to put them at centre-stage in all studies concerning migrations. While migration is the necessary precondition for diasporas to exist, not all migrant groups are internally bound by diasporic ties, nor ethnicity is the only source of such ties. In the case of highly skilled migrants, professional ties matter, too, as they both imply different migration channels and cohorts, and allows for specific forms of interaction. TKC is a theoretical and empirical project, whose deliverables will consist in research papers and open access datasets. Its ambition is to enrich the debate on migration on a global scale, but especially in Europe and France, where the dominant focus on low skilled or refugee immigration both obscures the importance of highly skilled flows and contributes to negative stereotyping. TKC will be articulated in six work-packages, taking a complementary approach between the macro (country), meso (firm), and micro (individual) levels of analysis. TKC has a strong engagement towards collecting micro-data concerning specific categories of very highly skilled workers, such as inventors, scientists and executives, with the migrant status to be ascertained by available biographic information and/or name analysis. These data may provide a suitable and interesting alternative to more classic data sources, both because of their detail and for their pointing at homogenous professional groups, rather than generically tertiary educated workers.