Copenhagen Economics InstituteShort CourseMarch 5-7 2007.ppt

Copenhagen Economics InstituteShort Course March 5-7 2007 Globalization in the Very Long Run March 6 Determinants and Impact of Mass Migration Part 1 The Determinants North-North in the first global century More North-North What about South-South? The demise of world migration The resurrection of world migration Selection issues: who migrates? Immigrant mix by origin: rising ethnic diversity Quality: falling skill and schooling relative to native-born Age: high labor participation and low dependency rates relative to native-born (stable) Gender: bias favoring males (stable) Rising ethnic diversity (by source) and debate about declining immigrant quality … and its return in the modern era. Four Stylized Quality Facts Native-born ‘quality’ (= human capital per person) rose across the late 19th century Foreign-born ‘quality’ fell across the late 19th century Native-born ‘quality’ rose across the late 20th century Foreign-born ‘quality’ rose far less across the late 20th century. Ergo, relative quality fell. US native-born ‘quality’ rose 1870-1930 The ‘quality’ of US immigrants fell 1820-1898 The ‘quality’ of the sending country pool of potential emigrants c1900 Relative wage and relative education: US immigrants vs native-born 1960-1990 Selection bias by age. … and by gender. To be explained in the modern era: changing FB shares in high-wage countries The Most Parsimonious Migration Model(in terms of stocks of FB) a la Robert Lucas We clearly need a better model! And let’s try finding one that explains the First Global Century with unrestricted migration before turning to the Second Global Century where migration is so tightly restricted. The (panel) emigration rates to be explained The incentives and investment sources The Stylized ELC Fact Modeling the ELC emigration responses Estimation Decomposition of the ELC Does the same model work today? Yes. It works for African emigration. It works for US immigration. And why not? Even though immigration policy