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From Nationals to Naturals: It’s a Natural Way to Think. Lant Pritchett International Migration: Challenges and Opportunities in the New Age of Mobility Public Affairs Conference 2008 April 11, 2008. Five Points.

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From nationals to naturals it s a natural way to think

From Nationals to Naturals: It’s a Natural Way to Think

Lant Pritchett

International Migration: Challenges and Opportunities in the New Age of Mobility

Public Affairs Conference 2008

April 11, 2008


Five points
Five Points

  • The usual structuring of the migration discussion into impacts on “sending” and “receiving” countries is structured to ignore the gains to the movers

  • Focus instead on income per natural—the income of people born in a given place

  • The wage gaps across workers are larger than ever in history—and are largely pure discrimination

  • Given the existing wage gaps there is nothing on the agenda to address gaps in income per natural remotely like allowing labor mobility

  • The “myth” at the heart of the existing international system will eventually have to be re-thought


The iron grip of place based thinking
The iron grip of place based thinking

  • Imagine a worker with above average income in a poor country moves to a rich country and makes twice as much but that is a below average wage—and there are no effects on anyone else (and the mover is much happier)

  • Average wages in the sending country fall

  • Average wages in the receiving country also fall.

  • So migration is a bad thing? Because analysis of sending and receiving countries reveals not benefits?


Income per natural
Income per natural

  • Think of the income per natural, per person of people born in Jamaica, that is, Jamaicans, no matter where they happen to reside

  • Income per natural is a measure of development of Jamaicans.

  • One is a place based measure and one is a people based measure




Wage gaps are largely historydiscrimination paying different wages to workers of equal productivity on either side of the border

Annualized wages of equivalent

workers—same nationality,

education, age, sex,

urban residence, sector

on either side of the border


Discrimination induced by the US border exceeds any other form of wage discrimination—and rivals the wage impact of slavery

Slavery in Virginia,

1840-1860, ratio rental

to subsistence: 3.8


Relaxing the discrimination against foreign naturals participation in labor markets produces larger gains than anything else available

  • For micro-based interventions compare the per person gain to the number of days/weeks of gains from labor mobility

  • Compare aggregate gains of “reforms” on the world agenda


The total present value of access to a participation in labor markets produces larger gains than anything else availablelifetime of micro-credit is the wage difference of 8 weeks work of the same worker in USA versus in Bangladesh

Source: Gains estimated from Pitt and Khandker for micro-credit

(annual gain of 14 percent of per capita HH consumption, CMP (forthcoming) for wages


Logic of the pax americana
Logic of the Pax Americana participation in labor markets produces larger gains than anything else available

  • Proliferation of sovereigns—with decolonization and end of empires many more states with borders

  • Free trade in goods promoted

  • Free trade in capital promoted

  • No expectation of labor mobility

    Implicit Myth: Every sovereign state is capable of an adequate standard of living for its naturals within its sovereign borders


Is the myth true
Is the myth true? participation in labor markets produces larger gains than anything else available

  • Population mobility across physical space has been a constant of human history for as long as there has been human history

  • Within large countries, like the USA, there is massive gross and net labor mobility over time—the emptying out of the rural middle

  • The borders created by colonialists were not driven by the logic of viable entities

  • No deep reason from economic theory to suppose this is so

    Are we sure there are no ghost countries?


The emptying of the heartland (only green shaded counties had substantial populationincrease over a 60 year period)


Massive Internal Mobility: Contiguous regions of the USA are a third their demographic counter-factual size


What i did not say
What I did not say are a third their demographic counter-factual size

  • The usual discussions of “sending country” impacts (remittances, brain drain) are driven by place based thinking

  • Income per natural is people based thinking that is the natural way to think

  • We are swimming in an ideology of nationalism—that may or may not continue


And social change takes time but can be complete

Attitudes towards Interracial Marriage in the US are a third their demographic counter-factual size

90

80

70

60

50

Percentage of Population

40

Percentage of Population

30

Approving

20

10

0

Year

1991

1978

1997

1968

1958

1972

1983

1994

2003

2002

2004

2007 (June)

2007 (Sept)

1963

MLK’s March on Washington

1992

LA riots spurred by tape of Rodney King beating

Barack Obama runs for President of the United States

MLK assassinated

And social change takes time.. But can be complete


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