nep-mig New Economics Papers
on Economics of Human Migration
Issue of 2013‒08‒23
seven papers chosen by
Yuji Tamura
La Trobe University

  1. Refugees and Early Childhood Human Capital By Todd Schoellman
  2. Institutions and the Location Decisions of Highly Skilled Migrants to Europe By Nowotny, Klaus
  3. Improving Immigrant Selection: Further Changes Are Required Before Increasing Inflows By Christopher Worswick
  4. Migration and Cross-Border Financial Flows By Maurice Kugler; Oren Levintal; Hillel Rapoport
  5. Migration and Dynamics: How a Leakage of Human Capital Lubricates the Engine of Economic Growth By Sorger, Gerhard; Stark, Oded; Wang, Yong
  6. Showing off to the new neighbors? Income, socioeconomic status and consumption patterns of internal migrants By Alexander M. Danzer; Barbara Dietz; Kseniia Gatskova; Achim Schmillen
  7. Integration as a catalyst for assimilation By Stark, Oded; Jakubek, Marcin

  1. By: Todd Schoellman (Arizona State University)
    Abstract: This paper quantifies cross-country differences in early childhood human capital. I embed a standard human capital production function into a cross-country model of human capital investment and labor market outcomes. The model predicts that only some human capital investment channels generate cross-country differences in early childhood human capital. I derive an empirical test of the importance of these channels. The test compares the late-life outcomes of otherwise identical immigrants who entered the U.S. at age 0 or age 5. I implement this test using the Indochinese refugees, who immigrated from poor countries during trying times, and for whom selection is unlikely to bias my results. The empirical results document a striking fact: there is no difference in late-life outcomes between Indochinese refugees who arrived at age 0 or age 5. I conclude that cross-country differences in early childhood human capital are small.
    Date: 2013
  2. By: Nowotny, Klaus (University of Salzburg)
    Abstract: The economic literature provides ample evidence that immigration of highly skilled workers is beneficial for the host economy. Yet, when compared to countries such as the USA or Canada, Europe receives a lower share of migrants with tertiary education, raising concerns that the EU does not attract enough highly skilled migrants. There is, however, considerable heterogeneity in the share of highly-skilled migrants across EU-15 countries which is even more pronounced at the regional level. This paper uses this heterogeneity to investigate the economic, labor market and institutional factors that make regions and countries attractive for highly skilled migrants vis-a-vis low-skill migrants. Controlling for a variety of regional characteristics, the regressions show both similarities and differences in the determinants of location choice between high- and low-skilled migrants and possible directions for migration policy.
    Keywords: highly-skilled migration; regional location decisions; institutions; migration policy
    JEL: C35 F22 R23
    Date: 2013–08–09
  3. By: Christopher Worswick (Carleton University)
    Abstract: Before increasing new immigrant intake targets, Canada should focus on improving immigrants’ labour market outcomes through reforms to the selection process, according to a report released today by the C.D. Howe Institute. In “Improving Immigrant Selection: Further Changes Are Required Before Increasing Inflows,” author Christopher Worswick cites recent evidence of poor outcomes for recent immigrants that raise a caution flag for higher annual targets.
    Keywords: Social Policy
    JEL: J15 J61 J68
  4. By: Maurice Kugler; Oren Levintal (Bar-Ilan University); Hillel Rapoport (Bar-Ilan University)
    Abstract: The gravity model has provided a tractable empirical framework to account for bilateral flows not only of manufactured goods, as in the case of merchandise trade, but also of financial flows. In particular, recent literature has emphasized the role of information costs in preventing larger diversification of financial investments. This paper investigates the role of migration in alleviating information imperfections between home and host countries. We show that the impact of migration on financial flows is strongest where information problems are more acute (that is, for more informational sensitive investments and between more culturally distant countries) and for the type of migrants that are most able to enhance the flow of information, namely, skilled migrants. We interpret these differential effects as additional evidence pointing to the role of information in generating home-bias and as new evidence of the role of migration in reducing information frictions between countries.
    Keywords: Migration, international financial flows, international loans, gravity models, information asymmetries
    JEL: F21 F22 O1
    Date: 2013–07
  5. By: Sorger, Gerhard; Stark, Oded; Wang, Yong
    Abstract: This paper studies the growth dynamics of a developing country under migration. Assuming that human capital formation is subject to a strong enough, positive intertemporal externality, the prospect of migration will increase growth in the home country in the long run. If the external effect is less strong, there exists at least a level effect on the stock of human capital in the home country. In either case, the home country experiences a welfare gain, provided that migration is sufficiently restrictive. These results, obtained in a dynamic general equilibrium setting, extend and strengthen the results of Stark and Wang (2002) obtained in the context of a static model.
    Keywords: Overlapping-generations growth model, Intertemporal human capital externalities, Long-run growth effect of the prospect of migration, Social welfare gains, Community/Rural/Urban Development, Institutional and Behavioral Economics, Labor and Human Capital, F22, I30, J24, J61, O15, O40,
    Date: 2013–07
  6. By: Alexander M. Danzer (Ludwig-Maximilians-Universität München); Barbara Dietz; Kseniia Gatskova; Achim Schmillen
    Abstract: This paper analyses incomes and socioeconomic status of internal migrants over time and in comparison to their new neighbors and investigates whether status consumption is a way for newly arrived city dwellers to signal their social standing. Using a novel dataset from the emerging economy of Kazakhstan we find that internal migrants earn an income and status premium for their move. In a comparison to indigenous city dwellers their earnings and household incomes are not significantly different; however, mobile households report a significantly higher subjective socio-economic status. Exploiting expenditure data, we find that recent migrant households gain status from using visible consumption to impress their new neighbors. This signaling might be used as adaptation to the new economic and social environment or to gain access to social capital.
    Keywords: Absolute and relative welfare, income, status consumption, conspicuous consumption, signaling model, adaptation, internal migration, rural-urban migration, emerging economy, Kazakhstan, socioeconomic status
    JEL: P36 I31 R2
    Date: 2013–07
  7. By: Stark, Oded; Jakubek, Marcin
    Abstract: We draw a distinction between the social integration and economic assimilation of migrants, and study an interaction between the two. We define social integration as blending into the host country’s society, and economic assimilation as acquisition of human capital that is specific to the host country’s labor market. We show that a non-integrated migrant finds it optimal to acquire a relatively limited quantity of human capital; with fellow migrants constituting his only comparison group, a non-integrated migrant does not have a relative-deprivation-based incentive to close the income gap with the natives. However, when a migrant is made to integrate, his social proximity to the natives exposes him to relative deprivation, which in turn prompts him to form more destination-specific human capital in order to increase his earnings and narrow the income gap with the natives. In this way, social integration becomes a catalyst for economic assimilation.
    Keywords: Assimilation, Integration, Social proximity, Interpersonal comparisons, Relative deprivation, Human capital formation, Consumer/Household Economics, Institutional and Behavioral Economics, Labor and Human Capital, D01, F22, J15, J24, J61, O15, Z10,
    Date: 2013–08

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