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I want to ask you if there is an explanation in your science of why there are so many migrants in the modern world?

I live in Russia, and after the dissolution of the USSR a lot of people here had to leave their states (former Soviet republics) trying to find a job in Russia (where the economic situation is a bit better in comparison with the other republics). At the same time many people are trying to emigrate from the former Soviet Union to the West.

When looking at the statistics I see that the situation with the employment in the former USSR is not the worst in the world, for example, according to this source, the unemployment rate in Russia is now 5.1%, in Uzbekistan 10.6%, and this is not so bad in comparison, say, with Spain, where it is 24.7%. However, the difference between 10.6% and 5.1% (together with some other parameters, like quality of life, etc.) force many people, millions of them, to seek a job abroad, and this is difficult for them (I am sorry for the normative statements).

So, to specify my question,

What is the attitude of the economic theory to this? Is this considered as a result of an unsuccessful economic policy, i.e. of some mistakes in the reforms, or this is regarded as normal (maybe, inevitable)? And

  • If these were mistakes, then what were these mistakes?
  • If this was normal, then I suppose there must be an understanding in your science of what people should do in this situation. How does the economic theory expect the jobless people to react? Are they supposed to leave their countries, or wait, or die? If they are supposed to leave, then there appears a contradiction between economics and politics, since usually emigration is very, very difficult, often impossible because of the political reasons. How is this contradiction supposed to be resolved?

From what I see in internet I got an impression that the situation in the former USSR is not unique, there are many other countries with similar problems, so, to tell the truth, I don't understand why people here insist that I should specify the country I am speaking about. If this is important, I have in mind the situation in Central Asia, i.e. countries like Uzbekistan, Tajikistan and around.

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    $\begingroup$ Levels of unemployment vary hugely by country, and by individual regions within a country. As do levels of migration - both inward and outward - and by type of migration (economic, refugee). $\endgroup$
    – 410 gone
    Jun 21, 2016 at 11:09
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    $\begingroup$ There isn't a single European situation. Every country is different, and in some countries, there are very big regional variations. Some countries will have net inward migration, others will have net outward migration. There are many possible answers, but being able to give the right one, depends on knowing what the specific question is. $\endgroup$
    – 410 gone
    Jun 21, 2016 at 11:55
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    $\begingroup$ Of course! They leave their countries because there is no job there. This could be normal if the level of unemployment in their countries was not so high. What do economists say about that? $\endgroup$
    – Sergei Akbarov
    Jun 21, 2016 at 16:55
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    $\begingroup$ @denesp, I don't understand you. The unemployment rate is different in different countries, according to wikipedia, for example: en.wikipedia.org/wiki/List_of_countries_by_unemployment_rate People leave their countries because of that, this is seen even without statistics. Isn't that enough for becoming interested what is wrong in the economics? $\endgroup$
    – Sergei Akbarov
    Jun 21, 2016 at 17:59
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    $\begingroup$ @denesp, you exaggerate my stupidity. I am not dreaming of "zero unemployment" or "never left their countries". And the questions you suggest are not exactly what I want to know. I'd like to understand what is the economic explanation of why the levels of unempleyment and migration in/from some countries are so high. Should I specify this in my question? $\endgroup$
    – Sergei Akbarov
    Jun 21, 2016 at 18:24

1 Answer 1

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Are current flows of migration bigger that they were in the past?

We tend to forget history because the numbers involved currently are smaller relative to world population. For instance, the 8.8 million immigrants who came to the United States in 1901-1910 period is of similar magnitude to the 9.1 million immigrants who came in the 1991-2000 period, but both the U.S. and world populations were much larger than in 1901-1910.

Richard B. Freeman in a nice paper, entitled "People Flows in Globalization," reminds us about this fact.

Some countries indeed receive large inflows of migrants

The US, Russia and Germany are the biggest recipients of immigration (see Table 1 in the above paper). These flows have consequences for factor endowment and there is considerable and often heated controversy over their impacts on destination countries.

How Do Immigrants Affect Their Countries of Arrival?

Freeman examines this question (p.18 to 23) and reviews the empirics. In the basic model of immigration, immigrants reduce earnings of substitute factors and raise the earnings of complementary factors, where complements might include capital and some types of native-born labor. In the basic model, there is full employment but you may intuitively consider quantitative adjustments instead of price/wage adjustements by introducing frictions in the labor market. Note than in most advanced countries, immigrants have higher unemployment rates and lower employment rates than native workers.

Related to this question a classical paper is "The Economics of Immigration," with theory and evidence by Georges Borjas in Journal of Economic Literature, December 1994. More recently, in 2015, Borjas published an interesting review on Immigration and Globalization. You mal also be intereted in reading his paper on how the collapse of the Soviet Union affects the productivity of American mathematicians.

Regarding policies Freeman considers "radically economic policies" such as auctioning immigration visas or charging sizeable fees and spending the funds on current residents to increase the economic incentive for advanced countries to accept greater immigration.

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