scale diversity and determinants of labour migration in europe while global migration is increasing internal eu migration flows have only increased slowly this paper contributes to a better understanding of the determinants and scale of european migration it surveys previous historical experiences and empirical findings including the recent eastern enlargements the determinants of migration before and after the 2004 enlargement and in the eu15 and eu10 countries are analysed using individual data on migration intentions in addition perceptions about the size of migration after the enlargement are studied the potential emigrant from both old and new eu member states tends to be young better educated and to live in larger cities people from the eu10 with children are less likely to move after enlargement in comparison to those without family there exists a correlation between individual perceptions about the scale of migration and actual flows better educated and left oriented individuals in the eu15 are less likely to perceive these flows as important

north american migration returns to skill border effects and mobility costs utilizing a utility maximizing roy type discrete choice model of worker location in canadian provinces and u s states that incorporates returns to skill amenities fixed costs distance langua

long term consequences of short term precipitation shocks evidence from brazilian migrant households we find that large short term precipitation shocks damage the long term income of households that have permanently migrated from rural to urban areas this outcome is consistent with the behavior of credit constrained rural households who are willing to accept lower long term income in urban areas following the depletion of their productive assets during an adverse shock our empirical evidence suggests that there may be a link between large precipitation shocks in rural areas and urban poverty further exploration is warranted on the mechanisms by which natural disasters cause these long term losses

europe s tired poor huddled masses self selection and economic outcomes in the age of mass migration during the age of mass migration 1850 1913 one of the largest migration episodes in history the united states maintained a nearly open border allowing the study of migrant decisions unhindered by entry restrictions we estimate the return to migration while accounting for migrant selection by comparing norway to us migrants with their brothers who stayed in norway in the late nineteenth century we also compare fathers of migrants and nonmigrants by wealth and occupation we find that the return to migration was relatively low 70 percent and that migrants from urban areas were negatively selected from the sending population keep ancient lands your storied pomp cries she with silent lips give me your tired your poor your huddled masses yearning to breathe free the wretched refuse of your teeming shore send these the homeless tempest tost to me i lift my lamp beside the golden door emma lazarus 1883

an upper bound on optimal income taxes abstract the message of this paper is very simple a certain range of tax rates determined by supply and demand functions only can be disregarded in linear optimal taxation approaches before any interpersonal utility comparisons are made in particular no marginal tax rate above a certain level can be optimal with respect to pareto inclusive social orderings it is shown that is in general not larger than and sometimes strictly less than the minimal tax rate at which tax revenues are maximal conditions under which is the least upper bound are given and a comparison is made with tax rates obtained by the rawlsian maximin principle

informational barriers to credit for migrants evidence from guatemala abstractdoes being a migrant in a developing country cause an individual to receive less access to credit migrant status can be a useful signal for lenders in settings with weak contract enforcement and in the absence of well developed information markets i investigate this contract enforcement based explanation using data on households that have migrated within guatemala to address reverse causality and omitted variable issues i adopt an instrumental variables approach i identify individuals who are most sensitive to violence or crime and who were born in particularly dangerous locations the interaction of these factors causes these individuals to have a higher propensity to move although such migrants are not less likely to apply for loans from formal sources they are significantly less likely to receive them furthermore weak enforcement of contracts dominates alternative explanations of this result such as moral hazard and adverse selection

investment and interruption effects of the us experience on the earnings of return migrants in mexico migration is widely viewed as an investment in human capital however due to the imperfect transferability of skills and knowledge across countries migration trips are also career interruptions especially for return migrants who may meanwhile experience depreciation of home country specific skills this article demonstrates that migration experience increases return migrants earnings in the home country on the condition that the migration stay is sufficiently long and mostly uninterrupted employing the revised human capital earnings function the empirical study shows that only a barely interrupted us experience longer than five years regardless of the legal status of the migration trips predicts higher earnings of male return migrants in mexico than comparable non migrants robust findings emerge controlling for unobserved individual acteristics or using instrumental variables to deal with the self selection and endogeneity short migration stays in the us and frequent traveling provide

changes in the international distribution of resources and their impact on u s comparative advantage t he heckscher ohlin h o theory suggests international trade is determined by relative resource supplies among countries prior empirical research such as work on the determinants of u s comparative advantage in a single year has concentrated on the static predictions of h o theory however h o theory also suggests changes over time in resource supplies will alter trade structure the present paper investigates this aspect of h o theory particular emphasis is given to the role of world resource changes as an explanation of changes in u s trade and of the increased international competition in manufactured goods faced by the united states some recent studies have examined the relationship between changes in resource endowments and trade heller 1976 examined changes in the factor content of japan s trade between 1958 and 1968 and found the observed patterns consistent with changes in japan s physical and human capital endowments stern and maskus 1981 investigated changing factor input determinants of u s trade by estimating annual cross section regressions over 1958 77 they suggested u s net exports made less direct use of unskilled labor over time further analysis of the factor content of u s trade suggested increased u s abundance in physical capital relative to human capital between 1958 and 1971 balassa 1979 using a 1970 crosssection of countries concluded that physical and human capital accumulation largely explained changing patterns of comparative advantage in manufactures although these studies made important contributions a number of issues remain concerning the relationship between resources and trade stern and maskus in listing directions for further research cite first an examination of how and why endowments of physical capital human capital and labor have changed within the u s and our major trading partners this paper reports a substantial data effort which addresses this topic another important consideration is that the direct effect of resource endowment variation on trade has yet to be determined previously inferences about the effect of resource endowments on trade have been based primarily on results from industry cross section regressions authors of such work indirectly infer the effect of resource variation on trade by assuming the coefficients from such regressions reflect resource abundance however leamer and bowen 1981 recently demonstrated that signs of coefficients from such regressions need not reflect a country s true resource abundance thus the usual negative coefficient for the capital labor ratio in an analysis of u s trade cannot be used to infer the scarcity of capital and thus cannot be used to infer the effect of an increase in capital endowment on u s trade similarly balassa s procedure of first regressing for each of a sample of countries industry trade on input intensity and then using the estimated coefficients as the dependent variable in a cross country regression on resources is an inappropriate method for inferring the effect of resources on trade this paper advances consideration of these issues by investigating aspects of the relationship between resources and trade section ii examines changing patterns of resource supply among thirty four countries over 1963 75 section iii investigates whether these resource changes are associated with altered comparative advantage in manufactured goods section iv uses cross country regressions to estimate the resource endowment as opposed to factor input determinants of u s manufacturing trade and thereby the direct effect of resource variation on u s trade the received for publication april 23 1981 revision accepted for publication november 30 1982 new york university this paper is an outgrowth of research in bowen 1980a and of further work conducted at ucla under a ford foundation grant directed by edward e leamer an earlier version was presented at the 1980 southern economic association meetings in washington d c comments by c michael aho robert baldwin edward leamer joseph pelzman leo sveikauskas and an anonymous referee are gratefully acknowledged the author remains responsible for errors

the impact of industrial policy on japan s trade specialization recent research has demonstrated the possibility of welfare enhancing industrial policy this paper analyzes the impact of industrial policy on japan s trade pattern and explores the possibility that it has been welfare enhancing econometric results indicate that industrial policies have had an impact on japan s trade specialization these results are obtained contemporaneously and when the explanatory variables are lagged suggesting either that policymakers have been forward looking or that policy interventions have had persistent long lasting effects although some cases of successful targeting are uncovered welfare enhancing interventions appear to have been the exception not the rule copyright 1993 by mit press

the effects of international migration on migrant source households evidence from ethiopian diversity visa lottery migrants about a million people have migrated to the us via the diversity visa dv lottery the dv was instituted by an act of the united states congress to diversify the u s population through a lottery made available to people from countries with historically low rates of immigration to the country in any given year the probability of winning the lottery is less than 1 with millions of people from around the world competing for a maximum of 55 000 immigrant visas that can be obtained through this migration channel using ethiopian dv participants which have consistently made up between 6 and 8 of all dv immigrants i study the causal effects of emigration on the well being of the migrant sending families i infer that migration contributes positively to the welfare of the source families overall migration increases consumer expenditure but has no effect on savings and business ownership of the senders the positive treatment effects do not diminish with duration of emigration migrant men contribute more to the increase in their families standard of living than their female counterparts do while expenditure on food and energy are invariant to the migrants gender the gains in terms of durable ownership access to clean water and sanitation facilities occur almost entirely in families where the emigrants are men i find that dv participants are favorably selected relative to the overall population

return migration human capital accumulation and the brain drain in this paper we present a model that explains migrations as decisions that respond to where human capital can be acquired more efficiently and where the return to human capital is highest the basic framework is a dynamic roy model in which a worker possesses two distinct skills that can be augmented by learning by doing there are different implicit price in different countries and different rates of skill accumulation our analysis contributes to the literature on the selection of immigrants and return migrants by offering a richer framework that may help to accommodate selections of emigrants and return migrants that are not immediately compatible with the one dimensional skill model our analysis has also implications for the debate on brain drain and brain gain in the two skills model presented here return migration can lead to a mitigation of the brain drain or even the creation of a brain gain where those who return bring the home country augmented local skills

comparative advantage in manufactured goods a re appraisal japanese input coefficients are used to investigate the pattern of comparative advantage in the exportation of manufactured products in a cross country framework estimates are made for the imports of manufactured products as well as for net exports also alternative techniques of estimation are utilized and an attempt to explain the residuals in the regression equations and to indicate the predictive power of these equations is made the paper shows that patterns of comparative advantage in manufactured goods can be explained by reference to commodity characteristics and country characteristics in turn intercountry differences in the extent of trade orientation the concentration of exports and foreign direct investment explain part of the residuals of the cross country regression equations finally it has been found that the method applied permits projecting the factor intensity of trade for individual countries

labour skills and the uk s comparative advantage with its european union partners this paper assesses the extent and sources of the uk comparative advantage within the european union eu it finds that both inter industry and intra industry trade are important despite clear aggregation effects having established that there is a significant degree of inter industry specialization the sources of this are analysed using a factor content approach results are reported for aggregate factors of production and in the case of labour by disaggregated skill categories a key finding is that the uk s net trade with the eu is driven more by a specialization in specific types of skill than by an overall endowment of human capital the results also suggest that the inter industry specialization cannot be explained by comparative advantage alone

international migration under asymmetric information international migration under asymmetric information usually differs from international migration under symmetric information and often quite dramatically so and in counterintuitive ways since in real life information is indeed asymmetric it is somewhat surprising that hitherto the study of international migration has by and large proceeded without explicit recognition of the effect of informational asymmetry in this paper we show that when at the lowest skill level migration is desirable i e if the discounted wage differential is positive for the lowest skill level the introduction of asymmetric information results in a reduction of the quality and quantity of international migration or has no effect at all when at the lowest skill level migration is not desirable the discounted differential is not positive at the lowest skill level the introduction of asymmetric information may either result in migration by all or none when under asymmetric information workers can at some cost to themselves report to foreign employers their individual skill thus dissociate themselves from the group effect then provided the cost is small either a u pattern of migration with respect to skill level emerges or migration is uniformly pursued by all though some do and some do not invest in signalling when the source consists of more than 1 poor country it is impossible to predict migration under asymmetric information from a given country without explicitly accounting for changes in the parameters of the other for example a favorable change encouraging less migration taking place in 1 country will through a distinct impact on the overall composition of migration reduce migration from the other country finally allowing employers to discover after a while the true productivity of individual migrant workers we obtain the somewhat surprising result that under a reasonable set of assumptions eventual discovery may increase the quantity and quality of migration and also increase the wage enjoyed by the low quality migrants eventual discovery serves to mitigate the impact of group averaging that deters migration by the high skill workers due to migration of some such workers the prediscovery wage of the low skill workers arises in our case sufficiently to outweigh the effect of the future wage decline due to discovery authors

self selection and the earnings of immigrants this paper analyzes the way in which the earnings of the immigrant population may be expected to differ from the earnings of the native population because of the endogeneity of the decision to migrate the empirical study shows that differences in the u s earnings of immigrants with the same measured skills but from different home countries are attributable to variations in political and economic conditions in the countries of origin at the time of migration excerpt

catching up the educational mobility of migrants and natives children in europe migrants into european countries are often less educated than european natives we analyse whether migrants children are more or less likely than natives children to achieve upward educational mobility across generations and study differences in the factors which contribute to differences in mobility for the two groups we find that migrants descendants are more often upwardly mobile and less often downwardly mobile than their native peers in the majority of countries studied and show that the main factor contributing to these patterns is the education level of parents although a lower parental education means that their children are less likely to access the same amount of human social and financial capital as children of more highly educated parents migrants descendants over the last two generations were able to make significant progress in reducing education gaps with natives

competing at home to win abroad evidence from japanese industry the study explores the influence of domestic competition on international trade performance using data from a broad sample of japanese industries domestic rivalry is measured directly using market share instability rather than employing structural variables such as seller concentration we find robust evidence that domestic rivalry has a positive and significant relationship with trade performance measured by world export share particularly when r d intensity reveals opportunities for dynamic improvement and innovation conversely trade protection reduces export performance these findings support the view that local competition not monopoly collusion or a sheltered home market pressures dynamic improvement that leads to international competitiveness

are immigrants favorably self selected one of the standard propositions in the migration literature is that migrants tend to be favorably self selected for labor market success that is economic migrants are described as tending on average to be more able ambitious aggressive entrepreneurial or otherwise more favorably selected than similar individuals who choose to remain in their place of origin in recent years there have been challenges to the general proposition of the favorable selectivity of migrants in addressing this issue this paper considers alternative specifications of the migration model that are relevant for the issue of migrant selectivity excerpt

factor proportions relative efficiency and developing countries trade abstract this study attempts to assess the extent to which ldc trade in manufactures can be explained by the factor proportions theory and the economies of scale account on the one hand and by commodity characteristics that affect relative efficiency on the other among the relative efficiency characterictics that affects trade patterns are r d intensity total factor productivity in the more developed countries factory size and some input output measures of the degree to which the industry interacts with the rest of the economy

the general validity of the heckscher ohlin theorem despite a number of attempts to extend it the heckscher ohlin theorem remains woefully restricted in terms of the generality of the assumptions needed for its proof in its traditional form as a statement about the commodity composition of trade the theorem is valid only in the highly abstract environment of the two factor two good twocountry model that has been the mainstay of trade theory for half a century a weaker version of the theorem involving the factor content of trade rather than its commodity composition has been proved for any number of factors goods and countries but this generality has so far been bought only at the cost of other and perhaps equally restrictive assumptions 2 the purpose of this paper is to provide statements and proofs of the heckscher ohlin h o theorem that are more general than those currently available the approach taken is similar to that used in my 1980 article for an extension of the theory of comparative advantage in terms of correlations between autarky prices and trade in section i i lay out the assumptions on which the analysis is based these assumptions provide the outlines of a reasonably general model in which there may be any numbers of goods and factors and in which factor prices may be equalized or not trade impediments in the form of tariffs or export taxes are permitted though transportation costs are not 3 in section ii i discuss the difficulty of inferring the factor content of trade in a world of unequal factor prices and i provide several alternative definitions of that concept for use later in the paper these together with the assumptions of section i are used in section iii to prove a theorem on the value at autarky prices of the factor content of trade in section iv this theorem is used to prove a first corollary that makes a more direct statement about the pattern of trade it says that worldwide there must be a negative correlation between the factor content of trade by factor and country and the corresponding autarky factor prices it is precisely these autarky factor prices that constitute the ohlin measure of factor scarcity therefore the corollary provides a formal statement of the general idea that countries tend to export the services of those factors which they have in relative abundance and it may be regarded as a generalization of the factor content version of the h o theorem finally a generalization of the commodity version of the theorem is proved in section v the concept of a covariance is generalized university of michigan i have benefitted greatly from the comments of paul degrauwe wolfgang mayer michael mussa carl simon and robert stern as well as others who participated in seminars at the universities of michigan chicago and cincinnati and at the national bureau of economic research an anonymous referee also made valuable comments with additional goods and factor price equalization the theorem runs afoul of the indeterminacy of production and trade noted by paul samuelson 1953 and james melvin 1968 without factor price equalization trade impediments and intermediate production can cause reversals of the pattern of trade as shown in my 1979 article if additional factors and countries are also added it becomes difficult even to state the theorem let alone to prove it 2melvin stated such a theorem for the three good two factor case and jaroslav vanek 1968 proved it for the general case but only by assuming factor price equalization trent bertrand 1972 and jon harkness 1979 were able to drop the factor price equalization assumption but replaced it with restrictions on consumption of either goods or factors by country of origin it is unclear to me however that these restrictions can ever be met in a model that is otherwise plausible harkness 1978 has also used the factor content version of the theorems as the motivation for a regression equation relating commodity trade to factor intensities this bears some resemblance to my analysis below in section v see however james anderson 1981 and edward leamer and harry bowen 1981 who have criticized his result with a reply by harkness 1981 3for ease of exposition i do not allow here for transportation costs these were included in an earlier version of this paper following the technique in my 1980 article

an evaluation of factor endowments and protection as determinants of japanese and american foreign trade we consider the relationship between the factor content of japanese and american foreign trade and examine empirically whether discrepancies between the heckscher ohlin theoretical predictions and the observed patterns of trade can be attributed to protection the michigan model of world production and trade is used for computational purposes we find some evidence of discrepancies between predicted and observed trade patterns but removal of protection either worsens these discrepancies or reduces them by only a small amount some possible reasons for the empirical shortcomings of the heckscher ohlin theory are offered in conclusion

commodity trade and relative returns to factors of production in this paper a model that can be used to estimate relative factor price differences between pairs of countries is developed estimation requires observations of actual bilateral commodity trade flows and knowledge of input requirements for commodity production the linchpin here is the set of relative production cost differences which on the one hand determine trade flows and which in turn are a function of production requirements and relative factor returns the model is implemented to estimate relative factor returns between the united states and each of eight other countries several useful applications of the model are suggested

heaven s swing door endogenous skills migration networks and the effectiveness of quality selective immigration policies a growing number of oecd countries are leaning toward the adoption of selective immigration policies which are expected to raise the quality or education level of migrants this view neglects two important dynamic effects the role of migration networks which could reduce the quality of migrants and the responsiveness of education decisions to the prospect of migration we propose a model of self selection into migration with endogenous education choices which predicts that migration networks and the quality of migrants can be positively associated when destination countries adopt sufficiently selective immigration policies empirical evidence presented as background motivation suggests that this is indeed the case

trade liberalization comparative advantage and scale economies stock market evidence from canada abstract the canada united states free trade agreement fta provides an excellent opportunity to analyze the impact of a comprehensive trade liberalization in this paper a stock market event study is employed to capture investors expectations about the consequences of this agreement for manufacturing firms in canada the primary question addressed is whether abnormal stock market returns corresponding to news about the fta are consistent with hypotheses based on comparative advantage and economies of scale the results indicate that both comparative advantage and scale economies played a role in determining investors perceptions of the impact of the fta

the origins of american industrial success 1879 1940 the united states became the world s preeminent manufacturing nation at the turn of the twentieth century this study considers the bases for this success by examining the factor content of trade in manufactured goods surprisingly the most distinctive characteristic of u s manufacturing exports was intensity in nonreproducible natural resources furthermnore this relative intensity was increasing between 1880 and 1920 the study then asks whether resource abundance reflected geological endowment or greater exploitation of geological potential it was mainly the latter jel 042 recent thinking about american economic performance has been marked by alarm over the country s loss of its competitive edge most of this discussion is not rooted in an understanding of the historical origins of the economic leadership now thought to be in jeopardy modern economists tend to assume that the american advantage has been technological and

immigrants and welfare programmes exploring the interactions between immigrant characteristics immigrant welfare dependence and welfare policy the primary purpose of this paper is to provide a review of the papers within the economics literature that have examined the questions of immigrant welfare use and the responsiveness of immigrants to the incentives created by welfare systems while our focus is largely on papers looking at the european case we also draw on studies from the united states in particular on issues where the european literature is thin one set of papers asks whether immigrants who are more likely to use welfare are attracted to more generous welfare states the results from these papers are not clear cut another set of papers asks if immigrants use welfare more intensively than natives and if they assimilate out of or into welfare participation in most cases the unadjusted data show higher use of welfare by immigrants although for some countries for example germany this can be explained by differences in immigrants characteristics yet another set of papers finds that the rate of welfare use by existing migrants can influence the welfare use of newly arrived co nationals we illustrate some of these issues by looking at immigrant welfare use in ireland and the uk immigrants in the uk appear to use welfare more intensively than natives but the opposite appears to be the case in ireland

global talent local careers circular migration of top indian engineers and professionals despite heightened interests from policy makers in the notion of brain circulation the discussion around the issue has remained largely theoretical drawing upon unique data of the alumni of a leading indian university this study examines how migration dynamics unfold within a highly educated population whose emigration is considered as a classic example of brain drain we adopt an integrative framework bringing together macro level push and pull influences and individual level selectivity we find that disparity in economic development between countries drives migration flows in both directions while host country demand has a stronger impact on out migration than on return migration we also detect significant selection effects at the individual level top students are more likely to emigrate and less likely to return in out migration flowing out of the country appear to be the best and the brightest amongst the highly educated talent pool in return migration negative selection is manifested in multiple aspects including ability post migration human capital investment and income we also find that the influences of macro forces vary amongst individuals higher ability individuals appear to be less affected by demand changes the findings have important policy implications for both source countries and receiving countries