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Migration, Trade, Capital and Development: Substitutes, Complements and Policies

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  • Gustav Ranis

    ()
    (Economic Growth Center, Yale University)

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    Abstract

    Migration of the unskilled clearly benefits the origin country, mainly due to the flow of remittances but also if the departure of some raises the ability of others to migrate. This depends on whether trade is a complement or a substitute for migration. The impact of such flows on the destination country is more ambiguous, although most research indicates that wages and employment are not likely to be seriously affected. Migration of the skilled is ambiguous with respect to the origin country since the impact of brain drain on local development must be weighed against the signaling effect for additional education plus the contribution of remittances. With respect to the destination country, the inflow of skilled labor is generally considered an unambiguous plus as it contributes to the enhancement of productivity. The paper concludes with policy recommendations aimed at seizing the opportunities arising from the fact that international migration remains the most constrained element of globalization.

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    File URL: http://www.econ.yale.edu/growth_pdf/cdp950.pdf
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    Bibliographic Info

    Paper provided by Economic Growth Center, Yale University in its series Working Papers with number 950.

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    Length: 16 pages
    Date of creation: Jan 2007
    Date of revision:
    Handle: RePEc:egc:wpaper:950

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    Related research

    Keywords: Migration; Trade; Globalization;

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    References

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    1. David Card, 1996. "Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration," Working Papers 747, Princeton University, Department of Economics, Industrial Relations Section..
    2. Richard B. Freeman, 2006. "People Flows in Globalization," NBER Working Papers 12315, National Bureau of Economic Research, Inc.
    3. Samuel Munzele Maimbo & Dilip Ratha, 2005. "Remittances: Development Impact and Future Prospects," World Bank Publications, The World Bank, number 7339, October.
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    Cited by:
    1. Ziesemer, Thomas, 2008. "Worker remittances, migration, accumulation and growth in poor developing countries," MERIT Working Papers 063, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

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