Future of Migration

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Future of Migration

• Lant Pritchett
• KSG Harvard and World Bank
• GDN Conference

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Overview Four points

• A bit of history
• Whither globalization?
• Rich country migration policy that is good for
  poor countries and poor people
• The power of ideas

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A bit of history Three facts

• Inequality across nation-states has become
  increasingly important
• The current wage gaps are enormously higher than
  in the age of mass migration
• Compared to the first wave of globalization
  (1870-1920) the difference is labor movements.

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Whither globalization?

• Movements of goods are liberalized, movements of
  capital are liberalized, movements of
  professional services are increasing
  liberalized (e.g. banking, insurance) including
  physical presence
• What is left?

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Nothing but labor intensive services

• Basic the welfare loss from policy induced
  price differences increases as the square of the
  distortion.
• All of remaining liberalization of goods trade is
  smaller than a 3 increase in labor movement.
• World welfare gains from all remaining trade
  liberalization are two orders of magnitude
  smaller than liberalization of labor flows.

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Why is this graph facetious?
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WTO?

• Cotton subsidies to US farmers and its impact on
  farmer in the Sahel.
• The best future imaginable, the one into which
  analysis and public advocacy and moral energy
  about the inequities of globalization is
  expended, is growing cotton in the Sahel?

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Is the Sahel really so much nicer than Kansas?

• There are regions of the USA the size of Sahelian
  countries whose population has declined by more
  than 25 since 1930
• The population of regions of the USA is one third
  as high as it would have been without outward
  migration.
• Niger has 10 million people.

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Rich country policies
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Ideas that block putting labor mobility on the
agenda

• Trade is a substitute for labor mobility
• Development is about poor nation-states not about
  poor people.
• Poverty is all relative
• It is politically impossible

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Politically impossible

• Labor flows are in fact deeply unpopular in
  industrial countries
• For good reasonsdistributional affects and
  bad
• But so is international trade and that has not
  stopped economists