The Economic Desirability of Migration Author(s): Tadeusz Stark Reviewed work(s): Source: International Migration Review, Vol. 1, No.

2 (Spring, 1967), pp. 3-22 Published by: The Center for Migration Studies of New York, Inc. Stable URL: http://www.jstor.org/stable/3002805 . Accessed: 26/01/2012 11:30
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The

Economic

Desirability

of

Migration by Tadeusz Stark*

The more one studies migration, the more he is struck by its com? from one country to of individuals as a movement plexity. Defined another with the intention of effecting a lasting change in permanent residence, migration is dependent upon multiple motives among which the demographic, social, psychological, political, cultural and economic are the most important. It is the object of this study to inquire only into the latter ones and to see what economic and what are the interests govern migration, economic or disadvantages in gen? of migration movements advantages eral and in concrete situations. In other words, we shall try to examine why migration at other times Some economic is sometimes considered to be economically interests. desirable and contrary authors consider to economic

that migration is determined principally by as a response to incentives of an economic nature; in the to-day it is the desire to become better off which is predominant decision to migrate.1 The motives which induce an individual to leave his country of origin or incline the receiving country to open its frontiers reasons (for instance the political reasons of refugee may often be non-economic have the same However, even in these cases, the movements migration). economic effects as if they had been carried out for purely economic motives. In general, the economic desirability of migration may be examined from two points of view: individual and national. In the first case, we inquire into the desirability of migration for a particular migrant, and in the second, into a possible gain to be obtained by a given country. In this second case, migration is the result of an individual act, but the interests of the collectivity as a whole are dominant. 1. This is, for instance, the opinion of Prof. Julius Isaac in his book: Economics of Migration (London: Kegan Paul, French, Trebner, 1947), p. 23, and Mario Zanartu: Necesidad de immigrantes para el desarollo economico de America Latina (Immigration Needs for the Economic Development of Latin America), chapter VI. * Dr. Tadeusz Stark, one of our Advisory Editors is the General secretary of the International Catholic Migration Commission. There

4 The

the

international

migration

review

of migration from the individual desirability point of view does not present much doubt; for an energetic and active migrant, migra? tion should be an economic after a transitory advantage. Normally, period, it should give him a higher standard of living and greater eco? nomic stability.2 And it is only legitimate for a man to try to emigrate in order to assure himself and his children of a better future. The situa? tion may be more difficult if the migrant remains a long time without his family which is left behind in the country of origin. Here the migrant avails himself very little of the higher wages gained in the immigration country. Besides the fact that living costs are usually higher in the new and what is country, he reserves for himself only the strict minimum sent to the family abroad does not allow a substantial increase in his of living.3 As to the desirability of migration on a national level, the prob? lem becomes complicated: aspects must be taken many more economic into consideration and at first sight the whole picture seems to raise some doubts. whether in recent times, many people ask themselves Especially emigration shoud not be considered as being rather harmful to a country. raised to migration on What is interesting to see is the opposition both sides, in the departure countries as well as in the reception coun? of the emigrants the importance tries. The first exaggerate intentionally an intrinsic constitutes for a country and stress that their departure loss for the country, but they are silent about the future gains. They maintain that it is always the best elements who depart and from the nationalistic point of view those leaving the country should be consid? ered as "traitors to the country." The Germans speak about "die Aus4 blutung unserer besten Menschenkrafte." seem to sometimes countries On the other hand, the reception and point out that the value of their intake of immigrants minimize in the reception countries do not draw more profit from the employers which takes than from another worker. In Switzerland an immigrant often hears one of immigrants in hundreds of thousands every year, cher" coute necessaire mal "un is that immigration (a necessary qui evil which costs dear). The immigration country is obliged to build up 2. George Rochcau: "Reflexions sur le droit aux migrations," and especially the paragraph: "Est-ie bon d'emigrer?" Revue de VAction Populaire, No. 184 (Jan? uary, 1966). 3. Charles Ageneau: "Migration?a necessity" in the monthly of the Economic and Social Research Center in Paris, Etudes et Documents (January-March 1965), p. 31. 4. Paul A. Ladame: "Les migrations comme facteur du developpement ecoat the General Assembly of the International Coun? nomique mondial"?expose cil of Voluntary Agencies (ICVA) held on August 11, 1961, in Geneva (p. 8). standard

THE ECONOMICDESIRABILITYOF MIGRATION and to extend its social

infrastructure schools for the immi? including and free for the immigrants. time centres grants' children, hospitals The immigrant is almost treated like a parasite occupying space which should be reserved for the national workers.5 in 1942, a Canadian writer, W. H. Chamberlin, Already justly remarked that "in immigration, in at? as foreign trade, the restrictive is to the The of in? titude benefits apt possess greater popular appeal. creased population felt. are general and slow in making themselves The dislocations, the injuries to the interests of special groups and classes comers of an influx of new? consequence and often exaggerated."6 and disadvantages of advantages both on the part of the immigration country which has benefitted from and on the part of the emigration of human resources, the importation country which has exported the migrant, deserve careful inquiry into which may be the immediate are quickly felt, are resented these two aspects Nevertheless, the question: who is right? In order to reply to this question, we shall at first examine suc? the benefits and losses of the emigration country and those cessively of the immigration country. Profit of the Emigration Country

after the second Thomas Professors Julius Isaac and Brinley to a de? attention draw World War were among the first in Europe to direc? and the volume factors determining tailed analysis of economic tion of migration between the sending and receiving countries.7 observed that from the economic point of view the flow of to those of higher pros? of low countries from prosperity goes migration real income of an indi? the of increase the and that prospective perity the factor in this process. Thomas examined vidual is the determining and the rate of real income per head in relations between emigration Great Britain and the swings of economic progress in the United States They how and coal output. He also analyzed as shown by railway construction to four great waves of immigra? reacted the American economy with a coincided each of which tion, period of relatively rapid growth. was in this context ,in fact, chiefly a remedy for low wages Emigration in the sending country. It carried labor from the place where it was to those where it was scarce. It exported workers from superabundant

5. Charles Caporale: "Coiit et profits des migrations Internationales," Revue de rAction Populaire (January, 1965), p. 49. 6. W. H. Chamberlain: Canada, Today and Tomorrow (1942), quoted by Julius Isaac, op. cit. 7. Julius Isaac: op cit.; and Brinley Thomas: Migration and Economic Growth (Cambridge University Press, 1954).

the

international

migration

review

was

the places where their productive power was less to a place where it greater. Isaac stressed that the real income of an individual is usually de? termined by two factors: 1) his net income in terms of money and 2) the purchasing power power of this money income. If the purchasing of money in the receiving in country is low (the present difficulties Latin America, for instance) and in the departing country high, there is no place migration," Thomas dynamics of international there are al? that, in the migration process, The former correspond to the in? elements. to The and the second immigration. country the element. than stronger "push" Dorothy

for migration. Speaking about "the remarked in his analysis ways "push" and "pull" terests of the emigration "pull" element is normally Swaine

came to the same Thomas, in her study of Swedish emigration, that the industrial two the conclusion, factors, among "pull" namely of America and the agricultural the former from Sweden, "push" important role in respect to the annual fluc? played an overwhelmingly tuations of the seventies to the end of the emigration era in Sweden, before the first World War. She "in stated: just prosperous years, Swed? ish industry was able to compete the with lure of Amer? successfully and the latest became towards an ac? ica, agricultural push emigration tive force only when a Swedish industrial depression occurred simul? with in or conditions the business new expanding prosperous taneously world."8 If we consider that the state policy of the emigration country should be directed towards securing a maximum amount of welfare for its individual members, we must conclude that it will be the first profit of the emigration and in? country that the emigrant gain employment is desirable as it crease his money income. In this respect, emigration results in an improvement of the standard of living of those emigrating, this takes place outside the country and the in? although improvement dividual with two leaves?temporarily or permanently?his country or origin. advantage for the emigration country is connected and consumption levels. As others, both on the production if an unemployed to production, man emigrates, his departure releases the country from the unproductive element; if he had a job before emi? grating he leaves increases But this indirect

it open to others. On the consumption side, the emi? the head, gration possible consumption owing to the re? per duced number of consumers who remain in the country. This may also reduce the price of the consumer the rule of supply articles following and demand. Thus, very often emigration as a means of imappears 8. Brinley Thomas: op. cit., p. 83.

THE ECONOMICDESIRABILITY OF MIGRATION

proving the incomes not only of the emigrants, but also of the remain? This is undoubtedly one economic of emi? advantage ing population. there are but others. gration, The second one is the flow of new capital earned by the emigrant the amount into emigration country. This is by no means a negligible of money sent to the country of origin of 1) remittances by the emigrant, 2) the capital brought back by the returning emigrant sent by the social security authorities to and 3) the family allowances in the country of origin (the latter item refers the families remaining within Europe). chiefly to movements As to the remittances of money sent back by the emigrants, the official figures are collected by the majority of countries to-day, but in fact they only disclose a part of the reality as there are many ways and thus considerable can avoid in which the emigrant controls, amounts are not this, we are able nomic advantage this figure before United States; he in the statistics of remittances. In spite of a high eco? to admit that the remittances represent to the country of origin. One of the first to calculate the first World War was Charles F. Speare for the indicated that out of the savings of foreign born mi? million a year were going abroad and that the annual recent included as it consists

10 per cent.9 we are times and recent migration movements, able to quote some statistics which are calculated year by year by the countries. For recent we for that the know, instance, sending years, in US remittances amounts dollars to emigrant's brought impressive As to more the following four countries: ? (of which $493 million only from those who $673,600,000 Italy had emigrated to European countries in 1965) ? $200,000,000 Spain Greece ? from emigrants in $170,000,000 (of which $40 million Turkey ? Europe) $150,000,000 (in 1965)

grants, $250 increase was about

a rising trend during the past figures have been showing The Spanish figure must also be completed by additional in France, from Spanish seasonal workers agricultural which brought $25 million more. It is interesting to look at the list of originating countries from were sent during 1963, 1964 and 1965 which the Italian remittances These few years. remittances in millions of dollars:10 9. Julius Isaac: op. cit., p. 244. 10. Italian Foreign Ministry: Problemi del Lav or o italiano all'Estero: relazione per il 1964 (Roma: 1965) p. 99; and: Problemi del lav or o italiano allestero: relazione per il 1965 (Roma: 1966), p. 96.

THE INTERNATIONALMIGRATIONREVIEW 1963 1964 $550.3 380.8 165.2 128.3 39.7 21.1 110.9 83.7 27.1 24.6 6.2 0.7 0.7 16.2 18.1 11.1 1965 $673.6 493.8 255.0 138.0 47.1 23.0 125.3 97.5 27.8 20.7 3.9 0.6 0.6 14.7 17.4 9.7

Total Europe of which Germany Switzerland France Belgium North & Luxemburg America (among others):

$522.2 335.5 147.8 104.0 36.3 20.2 115.4 88.9 26.8 America 30.6 6.6 1.7 1.3 19.6 19.8 13.9 There

of which United States Canada South

of which Argentina Brazil Uruguay Venezuela Australia Africa

is no space to comment in detail on these figures but it be that if stressed some may appear to be smaller, it depends upon the nature of the emigration movement. In France, for instance, there is a higher percentage of family reunion which obviously results in less remittances abroad. Also emigration to the United States, Canada or Australia has a more from definite Latin character of remittances America than others. The small amount can be explained by the recent in?

flation. In a paper submitted to the 1965 World Population Conference on the "Role of Emigrants' Remittances in the Economic Develop? ment of European Countries" Parent! of the University of professor Florence stressed that the possibility of the sending country disposing of an additional quota of imports without upsetting the balance of pay? ments is a positive fact in the sending country's process of develop? ment.11 11. Prof. Giuseppe Parenti: op. cit. in the text, p. 2. Cf. United Nations, World Population Conference, 1955, New York, United Nations, 1966, Vol., I, Pre? liminary Report, pp. 138-150.

the

economic

desirability figures

of migration 1960-1962

9 for four

He quotes the following sending countries:

for the years

Remittances in millions of $ Italy 1960 1961 1962 Spain 1960 1961 1962 Greece 1960 1961 1962 Portugal 1960 1961 1962 From 430.2 533.4 538.1 63.8 119.5 116.9 99.1 107.2 153.3 54.5 44.6 51.1

Percentage of imports 8.0 8.8 9.0 8.8 10.9 10.0 14.1 15.0 21.9 10.0 6.8 8.8

Percentage of national income 1.6 1.7 1.9 0.7 1.2 1.4 3.6 3.5 4.7 2.6 2.0 2.2

this table we can see that in 1961 this percentage of im? reaches 14 for Greece. almost 11% for Spain and from to 22% ports This allowed the countries concerned of raw ma? a larger consumption terials and machinery the process of as well as stating and continuing the national economy . transforming also goes One part of the remittances or directly invested in the payment of old merces or artisan activities and in buying of savings, the high rate of accumulation other to savings deposited in banks debts, in running small com? houses or land. Through the interest may be reduced. An?

off of real estate mortgages. result is the paying beneficial national their of role savings and directly pro? supplementing Through can be a decisive fac? the emigrants' remittances ductive investments, the modern development tor in implementing policy of a country. Finally, we come to the third profit drawn by the emigration coun? of the most active and en? knowledge try: widening of the professional elements who emigrate. terprising that this profit is rather difficult May it be stressed immediately to attain in the present times owing to the changes in the nature of movements to-day. In the early 20th century, a migrant who departed overseas often acquired new skills and a new profession. But today this happens more and more rarely. The migrants per? with modern themselves methods, acquaint haps learn new working and if they come from rural areas, they may adapt them? machinery selves to the new conditions in industry. But normally, they occupy

10

THE INTERNATIONALMIGRATIONREVIEW

of pro? where there is little possibility marginal and low occupations, fessional Their work very often consists in mechanical specialization. and monotonous chain work where there is nothing to learn. Of to this rule. But those who emigrate course, there are also exceptions It is more those today are not always the most active and enterprising. who cannot adapt to the life or work in the home country who try to escape from the difficulties by emigrating abroad. These elements some? times gain new skills, but in most cases, this does not happen unless they have a real desire to improve their standing. The emigration country would draw a profit from these emigrants if they return home. But here again, those who really acquire new pro? fessions do not return but remain definitely in the new country, having better working conditions will not find at home. the case to which they are accustomed and which they

In fact, this profit is therefore rather rare today. It may arise in of migration from an underdeveloped country, Africa for in? has been difficult, formation the educational until where now, stance, time For some to some developed already, France country. European African work? for centres has been organizing training pre-vocational to the new they acquire the ability to adapt themselves home coun? return to the their a After and skill. later, living in a constitute these Africans will comparison profit undoubtedly try, with the local elements. ers and there conditions Losses of Emigration Countries country has however, to note

some

Against losses

these profits, the emigration to its economy:

The most important is, without doubt, the loss of the emigrants. 1) Even if we admit that today it is not always the most active and best a loss. If elements of a worker constitutes who leave, the departure the emigrating worker has a technical skill learnt in the home country, the loss is even the most of greater. Some authors call this a true "amputation the of In the interesting preceding para? part population."12 graph, we explained that today this is not so often the case, as those who to the local life or are trying to emigrate here are often unadaptable rid of some the good worker normally remains home, difficulties; get unless there are other reasons to decide his departure.

The second disadvantage is more serious; it consists in the distor? 2) tion of the age and sex distribution The of the remaining population. an economic departure of an older worker is undoubtedly advantage 12. Charles Caporale: art. cit., p. 45.

the

economic

desirability

of migration

11

for the emigration country, but these categories emigrate rather rarely of the of the medical because commissions. In screening recruiting the commissions fix a maximum and mini? fact, migration recruiting mum age which is normally between 20 and 45 years. Some excep? tions were made during World Refugee Year for handicapped refugees but they are not general. Selection according to sex may also deprive the emigration of of a men marriageable country age which causes a real imbalance in the age structure of the population. The great pro? children and those who are ill, remaining in portion of old persons, the country, may endanger or perpetuate the obstacles to the develop? ment of entire regions of the country. The real effects of this state may create serious difficulties in the field of social security which loses the and retains only the "paid members."13 "paying members" The situation is much more serious if those emigrating are highly 3) trained engineers, doctors or belong to other liberal professions. A true "brain drain" results from this situation. A recent study by Enrique Oteiza from Buenos Aires drew attention to the serious consequences of the emigration of engineers from Argentina to the United States.14 It shows that when highly qualified manpower emigrates from a less one, the loss to the former is developed country to a more developed in train? very great. It causes an obvious loss of the capital investment which has no counterpart for the emigration coun? ing and education In the case of this investment is workers, try. professional high be? cause of the many years of study involved. The statistics quoted by the author show that during the recent period of 1950 to 1964 some for the United States highly qualified emigrants left Argentina whom were senior executives and 6,417 2,008 technicians, (among 5,379 skilled workers). It must be stressed that there are also large numbers of migrants in in other immigration in professional countries, occupations especially medical professions education and tech? (nurses, doctors), (teachers) 13,804 nicians reveal architects, etc.). The addition of the main figures (engineers, that in the post war period nearly 70,000 nurses, 30,000 physi? cians and 40,000 countries for engineers left the European emigration overseas.15 of France In the presence of these facts, we must agree with Professor Sauvy the atwho states that this problem has not yet received

13. Prof. A. Sauvy: Theorie generale de la population, Vol. I: "Economie et croissance," (Paris: Presses Universitaires de France, 1963), p. 291. 14. E. Oteiza: "Emigration of Engineers from Argentina," International Labor Review (December, 1965), p. 445. 15. T. Stark in Migration News (1963, No. 2), and Migration Facts and Figures, No. 28 (March-April, 1963). Especially interesting are the country-by-country tables concerning Canada, Australia, and the United States.

\2 tention

THE INTERNATIONALMIGRATIONREVIEW

it merits. The departure of this kind of emigrant is a serious loss for the emigration country. When big foreign overseas trusts come to contracts the best students in European offering schools, engineering the legality of the approach, the emigration notwithstanding country meets with a serious loss.16 4) for the emigration coun? Finally there is also another disadvantage difficulties of those emigrants who try which refers to the re-integration decide to return to their country of origin. Besides, the difficult re-adap? tation after their return, they often encounter obstacles in finding suit?

able placement because of differences in the development levels of both countris. Those who return, for instance from Europe to Africa, where there are less industries and fewer working possibilities, meet difficul? ties in being re-integrated into the local industries. This disadvantage constitutes the reverse side of the problem with which we dealt be? fore under profits for the emigration country, namely the widening of professional knowledge. enough, the returning emigrant Paradoxically who has gained some knowledge a worker unmay, in fact, become adapted to the level of his country, when he returns, and unable to be absorbed by the local industry in view of the existing conditions. He to accept a job which is far below his qualifications be obliged to emigrate again for ever.17 But here return again we must say that those who really acquire new professions rather rarely because they are already accustomed to more luxurious and are not inclined to return. Often also, the home country conditions does not absorb its yearly excess populaion and does not encourage peo? ple to return in view of the growing population. Profits of the Immigration Country is thus condemned and often he will

this balance sheet of the emigration we shall Against country, examine at present the benefits drawn from the newcomers by the im? migration country. There is no doubt today, that the economic profits of the immi? adds new riches that and are considerable immigration gration country and new wealth to the whole community. be expressed as raising the na? This contribution may generally This rise is the result of several tional income and living conditions. factors. In the first place it is due to the increase of production by a of the country. But immi? of the natural resources fuller exploitation gration does consumption not merely add to the supply of labor. It also increases and adds to the demand for goods and services; through

16. A. Sauvy: op. cit., p. 292. 17. C. Caporale: art. cit., p. 43.

the

economic

desirability

of migration

13

the latter it also leads to a demand for new labor both in the private and public sectors. By remedying a labor shortage, immigration makes it possible to direct workers to priority work by widening crucial bot? tlenecks. It stimulates a high rate of investment for an expansion of and other industries.18 manufacturing capacity in building, some To calculate all these factors in figures is difficult. However, the increase of the national calculate total to been have made attempts and to compare it to the total income which is due to immigrants amount of salaries paid to them. The attempt was made in Switzer? results.19 The real increase of land in 1962 and it revealed interesting estimated income was at 5% during the past few the Swiss national to the value of the immigrants' years. Of this some 2.5% was due to other factors such as progress work and the remaining percentage of the interior market. In the work and development in rationalizing in the present standard of living in other words, half the increase As during the period from to immigration. is attributed Switzerland 1954 to 1960 the real national income increased by 4,680 million Swiss would be some 2,390 million of immigration francs, the contribution This figure may be compared to the total amount of the It has been estimated at 800 million salaries paid to the immigrants. Swiss francs. Thus, the difference constitutes the value of the increase of the Swiss national income due to immigration. is This calculation, approximation, although based on simplified Swiss franks. rather instructive. recent estimate Kuznets on the relative in? of Professor fact that the countries a come per capita also shows very significant ab? the the top income bracket were now occupying major immigrant Australia.20 namely the United States, Canada and sorbing countries, Let us now examine the particular profits which together contrib? Another ute to the increase of the national income in an immigration country. order: the in listed be following They may per head, owing to the supply of new labor 1) Increase of production the labor shortages and remedying existing in the country. A calcula? and it showed tion was made before the last war by some economists countries that the rate of growth of output per head in the overseas 18. Prof. H. W. Arndt: "The National Economy and Migration," lecture given on October 30, 1963, at Canberra (Meeting ICEM-Information Department). 19. Quoted by G. Abraham Frois: "Capital humain et migrations internationales," Revue d'Economie Politique (March-April, 1964), p. 547. The estimate was made by Prof. Kneschaurek and reported in the article by Alfred Peter: "Ohne Italiener kein Wohlstand," (September, 1962). 20. Cfr. article by Brinley Thomas in the Quarterly of the Inter-governmental Committee on European Migration (ICEM), Migration (July-September, 1961), p. 12.

14

THE INTERNATIONALMIGRATIONREVIEW

and New up to 1913, such as Canada, the United States, Australia Zealand was much greater than in the sending countries. The receiving scale and entered the world's countries rapidly ascended the production of increase in real products per top income bracket. The percentage head per decade during the five decades before the first World War was 24.7% for Canada and 27.5% for the United States, whereas the increased sending countries like the United Kingdom by only 12.8%. It means that in the half century, the average increase in real product per head in Canada and the United States was twice as high as in the and it has been proved that a considerable sending countries part of from Europe. this process was played by the immigration The calculation of the increase in the production output by immi? of grants should not only include the direct addition to the production the new country but also the indirect elements which result from the fact that the migrants were occupied in a sector for which there were in the country, for instance mining. This liberates the few applicants local manpower for the more qualified tasks and widens the existing bottlenecks. The correction in the country is again 2) of age and sex distribution the reverse side of the situation in the emigration country which has been mentioned before. The increase in the rate of consumption. The new immigrants 3) contribute to raising the levels of consumption and to demands for new goods and services. As soon as the immigrant puts his foot on the soil he needs food and accommodation. of his new country, These are and necessities are that transferred into eco? psychological physical nomic demands within the purchasing power of the of the immigrant's budget allows one to know with influence of immigration on consumption. Professor zil has observed that the immigration country gains immigrant. A study more precision the de Avila from Bra?

much more in this respect if the immigrant comes with his family.21 If the immigrant mi? to send grates alone, during a longer or shorter period, he is compelled money home from his savings in order to support his family. If the him, he will not export his earnings but pour them family accompanies into the inner economic circuit. J. Bourgois-Pichat has also studied this problem in France and has arrived at the conclusion that family is the best solution.22 immigration Australian economists stress enlargement of the country's

domestic

that immigration contributes to the market for its own manufactur-

21. Prof. Fernando Bastos de Avila: Economic Impacts of Immigration (The Hague: M. Nijhoff, 1954), p. 59 and 60. 22. J. Bourgois-Pichat in the French journal Population of July-September, 1949, pp. 417-432 (quoted also by F. de Avila).

THE ECONOMICDESIRABILITYOF MIGRATION

15

domes? ing industries.23 Hitherto the relatively small size of Australia's with the larger tic market has been a major obstacle in competition industrial countries. growth through the increase of immi? Population has It is also true that the immigrants alleviated this grants problem. on the demand for public utilities such as exert pressure in Australia transport or public services. In this respect, and increase for employment opportunities market. create new the immigrants the demand on the labor

as a double In this respect, immigration may also be considered it a factor in insurance In was Australia against underemployment. de? keeping up the general tempo of business activity and economic about the future rate velopment by encouraging optimistic expectations of growth of demand. have Economists value of the immigrants. The gain of economic 4) known for a long time that the "immigrant not only creates economic the receiv? assets but is in fact one himself."24 Thanks to immigration, it because a makes considerable imports a unit for saving ing country it has not paid a penny. The salary paid to the im? whose education only as interest on capital brought migrant worker may be considered shall devote a separate study to We in from the emigration country. this problem. Here we merely state that the immigration country has which the of and the education immigrants training paid nothing for The terms. in is a substantial contribution even financial monetary value the countries is of human capital received in this way by immigration before. rather high in the case of the "brain drain" mentioned his Besides the in The migrant. by capital brought 5) personal the immigrant very often brings capital into the country. This value,

capital may be invested, wholly or partially, or oriented towards consumption. and spreading is one more taxpayer Bringing capital, the immigrant the general charges is always in interest of those who have to bear them. It is obvious that the value of the financial benefits brought in of the conjuncture by the immigrant varies according to the economic His economic of utility development.25 receiving country and its level is, of course, much greater in a country suffering from financial diffi? to refer to the fact already it is interesting culties. In this connection observed in the 19th century that the capital amounts brought into the United of this States were rather small. At the beginning by the immigrants the average amount per head of immicentury for instance,

23. H. W. Arndt: lecture quoted above, p. 4. 24. Prof. Fernando B. de Avila: "Immigration Development and Industrial Ex? pansion in Brazil," in the ICEM bimonthly Migration (July-September, 1961), p. 28. 25. Prof. F. B. de Avila: Economic Impacts of Immigration, op. cit., p. 63.

16 grant was

THE INTERNATIONALMIGRATIONREVIEW

for this was that many immi? only $15. The explanation did not make accurate statements on their arrival, and being grants of the reasons for requesting such information, suspicious they always thought it wiser to admit to much less than they really possessed.26 it may be said that immigrants do not carry all their capi? Nowadays tal with them but have it transferred to the immigration country through banks if the need arises. it may be de? of overseas capital is considerable, in smaller countries as to whether, from the financial point of in the country should be view, a large volume of overseas investment There are growing fears, at present, in countries such as encouraged. batable the danger of the country showing in? It is esti? the foreign control of its industries. Australia's industries is at pres? manufacturing interests. parent com? Many of the overseas their panies have no interest in their subsidiaries products exporting so that foreign control may operate as a major obstacle to the urgent? of the Australian ly needed development export trade in manufacture.27 Australia, Disadvantages The for Immigration mentioned some Countries earlier are counterbalanced or even losses. in the for example, on creasing dependence mated that one third of ent owned by overseas about If the attraction

difficulties countries

immigration disadvantages by first place, the competition of the immigrants with the national workers is often given as an argument against immigration. This is the reason trade workers' and unions oppose immigration why, in the past, why

In the

the legislative measures in some countries have tended to limit and curtail migration movements. Two reasons are generally mentioned by these opponents: for the national work? 1) the danger of unemployment ers and 2) the tendency to lower the wages of the national workers. If these dangers may effectively arise in some economic conditions, the economists and demographers are today in agreement that any mi? a releases of other multitude forces and that a constant and gration flow of allows the economic regular immigrants adjustments necessary to be made; usually economic systems are too dynamic to allow such interpretations.28 As to unemployment, is generally oriented towards immigration lower levels of secondary and tertiary sectors which the native workers refuse to fill. The existence of unemployment in a country does not 26. J. Isaac: op. cit., p. 235. 27. H. W. Arndt: op. cit., p. 6. 28. A. Sauvy: Theorie genirale de la population, op. cit., p. 295. F. B. de Avila: Economic Impacts of Immigration, op. cit., p. 64. J. Isaac: op. cit., p. 200. rigid

THE ECONOMICDESIRABILITYOF MIGRATION

yf

mean that there are no vacant jobs in the economic struc? necessarily the The demand for labor is not constant but vari? ture, just contrary. and the creates new in the able, migrant opportunities employment sector. To for fear of consumption oppose immigration unemployment is no wiser than to hinder mechanization for the same fear; the ma? chine takes the place of the worker, just as the migrant takes the place of the native. find As to the tendency to lower wages, it is true that immigrants as and in the unskilled workers new having country chiefly employment few means at their disposal, they are often obliged to take any job at the prevailing wage rates has the net undercutting any wage. However, result that demand at a lower price level increases and has a counter to migrants skilled on the declining trend of the wage rate. The opportunities open are often limited to unpleasant oc? jobs and extra-marginal a un? so that distinct from becomes cupations "non-competing group" effect

labor. cause

as a part of unskilled labor and can no longer be considered In certain industries, certain jobs become "immigrant jobs" and a concentration of ethnic groups in the big cities. Under these the immigrant's labor becomes a different factor particular conditions, of production. Its wage rate cannot be directly associated with the wage rate for unskilled workers in general because the native workmen are raised to a higher level of better paid jobs.29 We must agree with Professor Sauvy that the attitude of the trade is al? towards immigration unions of workers and liberal professions their interests may differ and that sometimes most always restrictive as they only refer to a particular from those of the whole population in qual? is If immigration sufficiently selective, the improvement group. quickly ity involves an increase and reduces population ly expressed.30 the of immigration, argument against the desirability new schools and new new houses, new factories, of constructing hospitals for the incoming migrants is often quoted. To bring new im? of the immi? migrants into the work force at the level of productivity same equip? the worker new the to it is give necessary gration country, ment already available to the average member of the native work force. As a second cost new shops and offices have to be built that new factories, the population installed. and machinery growth caused by Similarly, consumer on demands makes growing the immigrants goods and serv? to build is also ices of all kinds. Much capital housing and required This means 29. J. Isaac: op. cit., pp. 200-203. 30. A. Sauvy: op. cit., p. 296. in productivity, unemployment which contrary depends upon optimum to the opinion general?

18 to assure

THE INTERNATIONALMIGRATIONREVIEW all the facilities

of a wide range of social services such as education public (hospitals), (schools) and social security. New capital is needed to cover all these costs and for some coun? tries it may even mean a diminution of the real income per head. This is at present the case in Australia, where the economists generally be? lieve that owing to the high rate of population growth of 2.5% per year, these costs require high amounts and this accounts for Austra? lia's relatively in terms of growth of real income poor performance per head, a rate of about 1.5% per year only.31 health The third argument the loss of the capital which the concerns migrants send back to their country of origin. Here the loss is again the reverse side of the advantage gained by the sending country. But not only that. The remittances constitute a double loss in the sense that the capital earned by the immigrant is not used to buy consumer to the immigration but is goods which would be profitable country, sent abroad. It would be more advantageous for the immigration coun? try for this money to be spent on the spot for food or other services. In the last few years, in the Europe of the Six (Common Market) are and Algerians) (Italians, groups of immigrants Spaniards to earn family allowances, even if the family remains in the asset to the sending country of origin, and these are an appreciable Year the of these amounts are growing. country. by year, figures the immigrants of initial training Finally, the cost of the necessary of balance must be inscribed on the debit side of the gain and losses. if it is done state This cost is borne by industry or by the receiving now that upon at private or public courses. It is generally accepted his arrival and before the immigrant begins his work, he is usually allowed trained methods The to the local to adapt himself of work. This cost of training of Greece con? an? mi? and conditions in industry and to learn is sometimes local high. certain

Case

we shall analyze one the desirability of migration, labor to case of an emigration country supplying other country. In view of the recent increase of Intra-European gration, we have chosen Greece whose case is quite interesting To judge practical crete

generally less known. Our task is greatly facilitated thanks to the inter? at the University of Toronto, esting study of a professor of economics it to the Belgrade S. G. Triantis, World Population who presented Conference 1965).32 (September 31. W. H. Arndt: op. cit., p. 5. 32. Prof. S. G. Triantis: "Population, Emigration, and Economic Development," a paper contributed to the United Nations World Population Conference, 1965 (B9/I/E/20).

THE ECONOMICDESIRABILITYOF MIGRATION

19

The rate of natural population increase in Greece is rather low it 10 below 1963 situated was (in pro mille) and it shows a downward of people: trend. Here are some figures in thousands Natural 1959 1960 1961 1962 1963 increase 99.3 96.7 86.1 85.8 80.9 Emigration 23.7 47.8 58.8 84.1 100.1

The above table shows that in 1963, for the first time, emigra? mark and the natural popula? tion from Greece exceeded the 100,000 If we compare the figures referring to tion increase by almost 20,000. the proportion of workers among the emmigrants, it may even be stated from Greece has already ex? that the number of workers emigrating ceeded the natural addition to the labor force since 1961. is that owing to the Another feature of present Greek emigration are the emigrants to from overseas migration, Intra-European change no longer farmers and peasants but also craftsmen and industrial work? ers. from Greece to Western Eu? movement This intensive emigration motives ana? caused is by the economic mainly rope (chiefly Germany) of real in? difference the this of study, namely lyzed at the beginning come countries. The Greek Greece and the Western European besides in these are able to earn higher income countries, emigrants which is con? the latter have a higher level of economic development, nected to a shortage of manpower acting as a "pulling" power. Other this emigration are: easy means of communica? motives encouraging and countries of labor between the European tions, the liberalization between of money (remittances). to these "pulling" elements "pushing" factors correspond of desirable. In the first place, an insufficiency emigration and the un? the reduced size of the home economy natural resources, situation of Greece. A recent F.A.O. favourable study of geographic the agricultural structure of Greece is very categorical on several points: of the country which restricts the amount the mountainous topography of the soil, the dry of arable land to about one quarter, the poorness the free movement Numerous which make climate with irregular rain.33 In view of the country's poverty of resources the size of the Greek The yearly income per is small, at present and potentially. economy World Agricultural Structure,

33. Food and Agricultural Organization (FAO): Study No. 3: "Land Utilization," (Roma, 1964).

20

THE INTERNATIONALMIGRATIONREVIEW in view for development or sources of materials

head is only $400 and there are few prospects of Greece, far from external of the location markets. industrial large

These differences have existed for a long time, but today emigra? tion is easier because of the relaxation of European restrictions for im? The possibility of return? and progress in communications. migration ing home after some years was also a strong "pushing" factor to many who preferred life in Greece to staying abroad for ever. and losses of Greek emigration be evalu? How can the advantages ated? On one side of the economic for the profits is the possibility for those their income per head leaving fuller employment of the income who remain, thus bringing about a reduction and instability in the home country. Another profit of the inequality which ef? lies in the emigrants' remittances present Greek emigration to the country's income, for? contribution fectively make a substantial Here can also be included eign exchange and resources for investment. Greeks to increase the advantages Last of Western least, European the fact social services and other benefits. Greek meth? the Europe to themselves modern workers may more readily adapt working benefit. is an undeniable ods and industrial conditions but not that in Western

would appear, in the end, Under these circumstances, emigration the income rate of the whole popu? to be a natural way of improving behind. lation, both those migrating and those remaining However, the whole picture has darker sides showing the economic these disadvant? movements. of these outgoing Among undesirability of the the population distortion first is mentioned the one usually ages, draws heavily on In fact, emigration structure, by age and profession. re? the younger adults and attracts the more healthy. As to professions, fact that whereas in 1962 and cent statistics show a very discouraging 1963 together, only some 13,000 farmers and agricultural workers left manpower figure for low degree industrial Greece, the corresponding and craftsmen exceeded 100,000 together for those two years (i.e. 47,in 1963). This is very harmful to the coun? 267 in 1962 and 54,070 economic the From point of view, Greece is losing factory worker try. masses because of this exodus and, as a result, entire regions or com? munities will become derelict. In view of the low rate of natural increase in Greece, the fact that with the rate of structure increases of the population the distortion of and that a large flow emigration may result in sudden emigration changes in the structure of various Greek industries, it would seem that would be than during the year 1961-1962 a lower rate of emigration preferable.

THE ECONOMICDESIRABILITY OF MIGRATION In spite of these disadvantages, rather hesitate and declare themselves

21

to drawing safe conclusions this flow of emigration that the continuing. They point out, however, would be of a more non-economic reasons against emigration charac? the the i.e. of adversaries mixed ter, reasons, namely na? give majority and economic. tional, political, demographic They speak of the risk of "national suicide" and mention the necessity of retaining the country's and integrity. However, they forget that Greeks have present population often succeeded abroad thus contributed Conclusion We have seen, in theory and in practice, various arguments speak? in favour of the desirability of migration or against it. ing We have observed that in the final balance sheet, the economic and disadvantages seem to appear in various degrees on advantages both sides. of the economic situation of each It depends upon an examination to decide whether between involved of the two countries migration it is for eco? them is desirable or not. If some disadvantages prevail, a that the on them in such the nomic planning to change profits way national Each level can be mutual. may find an advantage for itself if it adapts the movement to its advantage, especially the reception countries, both or unrestricted in size and by timing the movements. Any exaggeration of the inflow often pro? increase seems to be dangerous. An exaggeration such as we have recently vokes a reaction from the local population, "brain drain" is, for instance un? seen in Switzerland. Any excessive of the countries favourable serve progress. pating be established to the emigration exchange may country, but a reasonable structure of each partici? It depends upon the economic a balance sheet of profit and loss must country and, therefore, ways, financial and others, to the strengthening of the Greek nation. in many and have

economists like Professor Triantis to be in difficulties when it comes as to the desirability or undesirability of

and the principle of reciprocal services should be applied. or undesirability of migration must be In the end the desirability of each in relation the to existing partner country. conjuncture judged Some authors maintain that by receiving an immigrant on its soil, the reception country imports a value for which it does not pay any counterpart.34 We cannot agree to that, as on both sides there are ad? vantages and measures that can be taken to improve these advantages or correct the disadvantages. Considering the long term aspects, it is difficult not to recognize

34. C. Caporale: art. cit., p. 44..

22 the beneficial

THE INTERNATIONALMIGRATIONREVIEW transfers in volume an efficient as a factor in economic and in quality, it may factor of structural ad?

results of population If is planned expansion. migration effect of being have the favourable justment in both countries.

Resume L'objet de cette etude est une recherche sur les interets economiques qui Les avantages et les desavantages economiques gouvernent l'emigration. des mouvements d'emigration en general et aussi dans des situations con? cretes sont deduits des etudes anterieures dans ce domaine et des cas de certains pays d'emigration. L'avantage economique de remigration peut etre analyse de deux points de vue: individuel et national. II semble qu'il n'y ait aucune regie universelle qui determine l'influence de remigration sur la situation economique d'un pays. Plutot, cela depend d'une evaluation de la situation economique de chacun des deux pays inter esses pour decider si remigration entre eux soit desirable.

Resumen El objeto de este estudio consiste en investigar los intereses economicos de los que gobiernan la migracion; las ventajas y desventajas economicas movimientos de migracion en general y en situaciones particulares son dede los ducidos de previos estudios de la materia y en casos especificos economica de migracion puede ser paises de emigration. La conveniencia examinada desde dos puntos de vista: individual y nacional. Parece que no hay regla universal que determine el impacto de la migracion y de la vida economica de un pais. Mas bien depende de un examen de la situa? tion economica de cada uno de los paises interesados en decidir si la mi? gracion entre ellos es deseable.

Zusammenfassung Inteder wirtschaftlichen Das Ziel dieser Studie ist eine Untersuchung Vor- und Nachteile ressen, die die Migration steuern. Die wirtschaftlichen im allgemeinen und in konkreten Situationen von Migrationsbewegungen sind abgeleitet von friiheren Studien, die in spezifischen Auswanderungslaneiner Erwunschtheit worden sind. Die wirschaftliche dern unternommen aus untersucht werden: einem Migration kann von zwei Gesichtspunkten individuellen und einem nationalen. Es scheint keine allgemeine Regel zu Leben eines geben, die den Anlass zur Migration und das wirtschaftliche der wirtschaft? Landes bestimmt. Vielmehr hangt es von der Untersuchung lichen Lage beider in Frage kommender Lander ab, um zu entscheiden, ob Migration zwischen ihnen erstrebenswert ist oder nicht.