Research on Immigration and Integration in the Metropolis

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• Research on Immigration and Integration in the
  Metropolis
• www.riim.metropolis.net

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Immigration, Emigration and Calgary

• Don J DeVoretz
• Co-director RIIM
• Feb. 8, 2001

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Benefits and Costs of Immigration

• Economic Affects of Immigration
• Treasury
• Drain or Gain
• Job Market
• Wage Compression or Expansion
• Job Displacement or Creation
• Goods Market
• Price Effects - housing inflation
• Quantity Effects

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Calgary Immigrant Household 1996

• Tax is concave in age
• Use is convex in age
• Result is
• Calgary Immigrant lifetime contribution
  55,370
• Canadian Immigrant lifetime contribution 94,000

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Expenditure Impact
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Costs Benefits of Emigration

• Public Costs
• Treasury costs of post-secondary leavers
• Externalities loss of job creation and exports
• Loss of future income and taxes
• Private Costs
• Causes retention in 80 - 95 of Cases
• Loss of social safety net age specific
• Loss of social contact
• Loss of social and physical amenities

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Risk of Movement to USA
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Private Benefits of Emigration

• 40 rate of return Canada-US
• Ease of return migration
• Career Advancement

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Rate of Return and Emigration
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Churning Costs of Immigration

• Canada is engaged in brain exchange
• Canada loses 10,000 highly skilled to USA
• Canada imports 18,000 highly skilled ROW
• Does this Net 8,000 solve the problem ?
• What if 18,000 does not match 10,000
• What is cost of this churning ?
• 12 billion circa 1989-96

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Churning Costs
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Conclusions Brain Exchange

• Minor loss due to educational subsidy
• Minor cost due to settlement costs
• Large costs due to productivity loss
• Calgarys position is probably worse than ROC

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Policy Options

• Reduce Churning Costs through
• Internships
• Foreign graduate student conversion
• Bribe Canadians to come home
• WHY?
• Cheaper Canada 1968-72 program
• Unethical to import without compensation