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International migration and the world income distribution

Author

Listed:
  • 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 2¼ 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.

Suggested Citation

  • Devesh Kapur & John McHale, 2009. "International migration and the world income distribution," Journal of International Development, John Wiley & Sons, Ltd., vol. 21(8), pages 1102-1110.
    • Handle: RePEc:wly:jintdv:v:21:y:2009:i:8:p:1102-1110
    DOI: 10.1002/jid.1649
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    References listed on IDEAS

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    Cited by:

    1. Martin Guzi & Martin Kahanec & Magdalena M. Ulceluse, 2021. "Europe's migration experience and its effects on economic inequality," MUNI ECON Working Papers 2021-05, Masaryk University, revised Feb 2023.
    2. Francine D. Blau & Lawrence M. Kahn, 2012. "Immigration and the Distribution of Incomes," NBER Working Papers 18515, National Bureau of Economic Research, Inc.
    3. Deniz Sevinc & Edgar Mata Flores, 2021. "Macroeconomic and financial implications of multi‐dimensional interdependencies between OECD countries," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(1), pages 741-776, January.
    4. 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.
    5. Ulceluse, Magdalena, 2019. "The long-term effect of migration on economic inequality between EU Member States," GLO Discussion Paper Series 383, Global Labor Organization (GLO).
    6. 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.

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