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Migration, skill composition and growth

Migration, skill composition and growth
Migration, skill composition and growth
The UK, with its relatively liberal immigration policies following recent enlargements, has been one of the main recipients of migrants from new EU member states.This paper poses the questions: what is the effect of immigration on a receiving economy such as the UK? Is the effect beneficial or adverse for growth? Does emigration have brain drain effects on sending economies? How differently would skilled (or unskilled) migration affect both receiving and sending economies? What factors would contribute to immigration/emigration benefits/costs and economic growth driven by migration? Who are the winners and losers in both the sending and host regions? We utilise a two-bloc endogenous growth model with labour mobility of different skill compositions to address these questions. We show that migration, in general, is beneficial to the receiving country and increases the world growth rate. With remittances, the sending country in aggregate can also benefit. The only exception is in the case of unskilled migration, which can actually have a detrimental impact on the world growth rate. This possibility however seems to be unlikely by our examination of migration trends. Winners are migrants, and the skill group in the region that sees its relative size decrease.

migration, labour mobility, skill composition, economic growth
0027-9501
R5-R19
Kim, Young-Bae
2cccb2c3-f5d4-4bd2-9ac7-66bcbcb72196
Levine, Paul
6978934c-ecab-4709-a683-6114445c3fc5
Lotti, Emanuela
e3a301e8-bfbe-4ac7-ba41-5020251171a5
Kim, Young-Bae
2cccb2c3-f5d4-4bd2-9ac7-66bcbcb72196
Levine, Paul
6978934c-ecab-4709-a683-6114445c3fc5
Lotti, Emanuela
e3a301e8-bfbe-4ac7-ba41-5020251171a5

Kim, Young-Bae, Levine, Paul and Lotti, Emanuela (2010) Migration, skill composition and growth. National Institute Economic Review, 213 (1), R5-R19. (doi:10.1177/0027950110380321).

Record type: Article

Abstract

The UK, with its relatively liberal immigration policies following recent enlargements, has been one of the main recipients of migrants from new EU member states.This paper poses the questions: what is the effect of immigration on a receiving economy such as the UK? Is the effect beneficial or adverse for growth? Does emigration have brain drain effects on sending economies? How differently would skilled (or unskilled) migration affect both receiving and sending economies? What factors would contribute to immigration/emigration benefits/costs and economic growth driven by migration? Who are the winners and losers in both the sending and host regions? We utilise a two-bloc endogenous growth model with labour mobility of different skill compositions to address these questions. We show that migration, in general, is beneficial to the receiving country and increases the world growth rate. With remittances, the sending country in aggregate can also benefit. The only exception is in the case of unskilled migration, which can actually have a detrimental impact on the world growth rate. This possibility however seems to be unlikely by our examination of migration trends. Winners are migrants, and the skill group in the region that sees its relative size decrease.

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More information

Published date: July 2010
Keywords: migration, labour mobility, skill composition, economic growth

Identifiers

Local EPrints ID: 174535
URI: http://eprints.soton.ac.uk/id/eprint/174535
ISSN: 0027-9501
PURE UUID: 231a8fee-709f-439a-91b9-f4f7c56795eb

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Date deposited: 14 Feb 2011 13:40
Last modified: 14 Mar 2024 02:34

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Contributors

Author: Young-Bae Kim
Author: Paul Levine
Author: Emanuela Lotti

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