nep-mig New Economics Papers
on Economics of Human Migration
Issue of 2008‒08‒21
three papers chosen by
Yuji Tamura
Australian National University

  1. The Place Premium: Wage Differences for Identical Workers across the U.S. Border By Michael Clemens; Claudio Montenegro; Lant Pritchett
  2. A Generalized Index of Fractionalization By BOSSERT, Walter; D’AMBROSIO, Conchita; LA FERRARA, Eliana
  3. International Trade Negotiations and the Trans-Border Movement of People: A Review of the Literature By A. Strutt; J. Poot; J. Dubbeldam

  1. By: Michael Clemens; Claudio Montenegro; Lant Pritchett
    Abstract: We compare the wages of workers inside the United States to the wages of observably identical workers outside the United States—controlling for country of birth, country of education, years of education, work experience, sex, and ruralurban residence. This is made possible by new and uniquely rich microdata on the wages of over two million individual formal-sector wage-earners in 43 countries. We then use five independent methods to correct these estimates for unobserved differences between the productivity of migrants and non-migrants, as well as for the wage effects of natural barriers to international movement in the absence of policy barriers. We also introduce a selection model to estimate how migrants’ wage gains depend on their position in the distribution of unobserved wage determinants both at the origin and at the destination, as well as the relationship between these positions. For example, in the median wage gap country, a typical Bolivian-born, Bolivianeducated, prime-age urban male formal-sector wage worker with moderate schooling makes 4 times as much in the US as in Bolivia. Following all adjustments for selectivity and compensating differentials we estimate that the wages of a Bolivian worker of equal intrinsic productivity, willing to move, would be higher by a factor of 2.7 solely by working in the United States. While this is the median, this ratio is as high as 8.4 (for Nigeria). We document that (1) for many countries, the wage gaps caused by barriers to movement across international borders are among the largest known forms of wage discrimination; (2) these gaps represent one of the largest remaining price distortions in any global market; and (3) these gaps imply that imply allowing labor mobility can reduce a given household’s poverty to a much greater degree than most known in situ antipoverty interventions.
    Keywords: wage, migration, economic development
    JEL: F22 J61 J71 O15
    Date: 2008–07
  2. By: BOSSERT, Walter; D’AMBROSIO, Conchita; LA FERRARA, Eliana
    Abstract: The goal of this paper is to contribute to the economic literature on ethnic and cultural diversity by proposing a new index that is informationally richer and more flexible than the commonly used ‘ethno-linguistic fractionalization’ (ELF) index. We characterize a measure of diversity among individuals that takes as a primitive the individuals, as opposed to ethnic groups, and uses information on the extent of similarity among them. Compared to existing indices, our measure does not require that individuals are pre-assigned to exogenously determined categories or groups. We show that our generalized index is a natural extension of ELF and is also simple to compute. We also provide an empirical illustration of how our index can be operationalized and what difference it makes as compared to the standard ELF index. This application pertains to the pattern of fractionalization in the United States.
    Keywords: Diversity, Similarity, Ethno-Linguistic Fractionalization.
    JEL: C43 D63
    Date: 2008
  3. By: A. Strutt (University of Waikato); J. Poot (University of Waikato); J. Dubbeldam (University of Waikato)
    Abstract: We review the international and New Zealand literatures on the two-way interaction between international migration and agreements designed to enhance cross-border trade or investment. Benefits and costs of migration, to the extent that these may feature in trade and migration negotiations, are discussed. While trade and migration can be substitutes in some contexts, they will be complements in other contexts. Liberalisation of services and the movement of people are likely to offer much more significant gains than liberalisation of remaining barriers to goods trade. Significant scope for liberalisation under GATS mode 4 (the movement of natural persons) may remain. However, temporary migration is already promoted on a unilateral and bilateral basis within immigration policy frameworks that may provide greater flexibility than GATS mode 4. With respect to both trade and migration, the more diverse the exchanging countries are, the greater the economic benefits tend to be. However, greater diversity may also imply greater social costs. This paradox of diversity needs to be addressed through appropriate social policies accompanying enhanced temporary and permanent migration.
    Keywords: international trade; migration; outsourcing; temporary workers; e-labour; GATS; negotiation
    JEL: D60 F13 F15 F22 F51
    Date: 2008–06–30

This nep-mig issue is ©2008 by Yuji Tamura. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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