The world has summarily discarded vast systems of restrictions on the labor mobility of medieval serfs, slaves, women, South African blacks, indigenous Australians, and a long list of others.

I highly recommend the paper Economics and Emigration: Trillion-Dollar Bills on the Sidewalk? (pdf, summary) by Michael Clemens as well as a companion materials (mp3 interview).

Clemens surveys the small (four studies; I think I’d only heard of one of them) literature that has estimated the gains from removing all barriers to international migration. The estimates range from 67% to 147% of global product! Compare with summing high and low estimates for removing all barriers to international trade and investment: between 0.4% and 5.8% of global product. Yet the amount of attention given to these topics by economists is the inverse, and mostly from the immigration, rather than emigration side of the coin. At best a case of chasing easy precision over oomph (Clemens speculates lack of study could be due to obviousness, mercantilist/nationalist tradition, and lack of data).

I was happy to see mention of historical examples:

Of course, these elasticities could be different at much higher levels of emigration. The literature gives no clear support for such a pattern, however, even under greatly increased migration. In historical cases of large reductions in barriers to labor mobility between high-income and low-income populations or regions, those with high wages have not experienced a large decline. For example, wages of whites in South Africa have not shown important declines since the end of the apartheid regime (Leibbrandt and Levinsohn, 2011), despite the total removal of very large barriers to the physical movement and occupational choice of a poor population that outnumbered the rich population six to one. The recent advent of unlimited labor mobility between some Eastern European countries and Great Britain, though accompanied by large and sudden migration flows, has not caused important declines in British wages (Blanchflower and Shadforth, 2009).

“Brain drain” used an excuse for apartheid (it’s good for them!) makes me sad, but gladly the literature does not offer support for the effect, as I suspected. There’s a passing mention in the paper, and a bit more in the interview, concerning emigration from Sweden — Clemens says 1/3rd of the population left. The two citations in the linked Wikipedia article claim 20% and 33%, but probably cover different time periods. I’d like to see a comparison of annual emigration rates for various geographies at various times. Clemens also says that one can read anti-immigrant statements in U.S. newspapers a 100+ years ago that mirror those of today.

A couple other quotes from the paper:

economists should be open to the possibility that dramatic changes in what is practical can happen over several decades. After all, changes in geographic labor mobility that were unthinkable only a few decades ago have come to pass. Through the 1980s, a Polish national attempting to emigrate to West Germany could be shot by soldiers sealing the Inner German border from the east. Today, Polish jobseekers may move freely throughout Germany. The world has summarily discarded vast systems of restrictions on the labor mobility of medieval serfs, slaves, women, South African blacks, indigenous Australians, and a long list of others.


These initial results accord well with an entirely separate macroeconomic literature (for example, Hall and Jones 1999) which finds that most of the productivity gap between rich and poor countries is accounted for by place-specific total factor productivity, not by productivity differences inherent to workers. Large differences in location-specific total factor productivity mean that free movement of goods and capital cannot by themselves achieve the global equalization of wages, as they can in the most abstract trade models (O’Rourke and Sinott, 2004; Freeman, 2006, Kremer, 2006).

Place-specific total factor productivity can increase, and people in all places should strive to do so (best autonomously) — that’s approximately what “development” is about — results are very, very mixed. I wonder if various “open” things can’t help more than they do now, and will write about such eventually, but it’d be on the margin. And international apartheid is an abomination that should be eliminated immediately regardless of the long-term substitutability of development and migration.

The economics profession of the 20th century has taken a pass on migration, as they have on IP, with even more tragic results. Please change that! As his interviewer says, Clemens’ paper sketches a research program good for many Ph.D. theses.

3 Responses

  1. […] above is around the corner from where I live. I’m happy to find out that it means what I hoped — though I’d be surprised if the muralists didn’t arrive via some very different […]

  2. […] the international apartheid regime, keeping billions in poverty and oppression (or put another way, massively squandering human capital) out of fear and […]

  3. […] about Clemens’ paper Economics and Emigration: Trillion-Dollar Bills on the Sidewalk? which I wrote about last year (and similarly used a pull quote headline). I recommend the podcast and […]

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