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International migration and the world income distribution

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  • Devesh Kapur

    (Centre for Advanced Study of India, University of Pennsylvania, Philadelphia, USA)

  • John McHale

    (Department of Economics, National University of Ireland, Galway, Ireland)

Abstract

Emigrants moving from poor to rich countries experience large income gains on average. These gains are further augmented by remittances that allow a portion of the gains to be spent at lower sending-country prices. Taking advantage of recently available estimates of emigration-related income gains, this paper estimates the direct impact of international migration on the world income distribution. We find that international migration raises world income per person by just under 1 per cent, while it raises the incomes of those born in developing countries by approximately 2� per cent relative to the no-migration benchmark. Allowing for the remittance price effect augments these gains by about half. International migration also decreases the between-country component of world inequality (as measured by the between-country Theil coefficient) by about 2 per cent. While these aggregate income gains are significant, even small 'brain-drain' related adverse growth effects could quickly swamp the direct gains to migrants where rich-country immigration policies have a strong skill bias. A surer route to realising the potential of migration to increase world welfare would be to expand emigration opportunities for the less skilled. Copyright © 2009 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/jid.1649
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Bibliographic Info

Article provided by John Wiley & Sons, Ltd. in its journal Journal of International Development.

Volume (Year): 21 (2009)
Issue (Month): 8 ()
Pages: 1102-1110

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Handle: RePEc:wly:jintdv:v:21:y:2009:i:8:p:1102-1110

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Web page: http://www3.interscience.wiley.com/journal/5102/home

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  1. Giovanni Peri & Gianmarco I.P. Ottaviano, 2006. "Rethinking the Effects of Immigration on Wages," Working Papers 634, University of California, Davis, Department of Economics.
  2. Francesco Caselli, 2004. "Accounting for Cross-Country Income Differences," NBER Working Papers 10828, National Bureau of Economic Research, Inc.
  3. Robert E. Hall & Charles I. Jones, 1999. "Why Do Some Countries Produce So Much More Output Per Worker Than Others?," The Quarterly Journal of Economics, MIT Press, vol. 114(1), pages 83-116, February.
  4. Guillermina Jasso & Mark Rosensweig & James P. Smith, 2003. "The Earnings of US immigrants," Labor and Demography 0312007, EconWPA.
  5. Mattoo, Aaditya & Neagu, Ileana Cristina & Özden, Çaglar, 2008. "Brain waste? Educated immigrants in the US labor market," Journal of Development Economics, Elsevier, vol. 87(2), pages 255-269, October.
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Cited by:
  1. Francine D. Blau & Lawrence Kahn, 2013. "Immigration and the Distribution of Incomes," CESifo Working Paper Series 4561, CESifo Group Munich.
  2. Ben Crow & Nichole Zlatunich & Brian Fulfrost, 2009. "Mapping global inequalities: Beyond income inequality to multi-dimensional inequalities," Journal of International Development, John Wiley & Sons, Ltd., vol. 21(8), pages 1051-1065.
  3. María del Pilar Bohada R., 2010. "Desplazamiento forzado y condiciones de vida de las comunidades de destino: el caso de Pasto, Nariño," Revista de Economía Institucional, Universidad Externado de Colombia - Facultad de Economía, vol. 12(23), pages 259-298, July-Dece.

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