Monday, September 12, 2016

Economics of Emigration

People do a lot of research on the economics of immigration (i.e.: what made immigrants leave their homelands and the effect they have on their new countries), but I'm not sure I've seen much of anything on the result in the homeland of the emigration. I would expect that it's reinforcing of the initial decision.

Let's say Country A is of comparatively "low quality" in some way that makes citizens of Country A want to leave for Country B. But not all citizens feel this attraction equally. Those most likely to get "emigration fever" would be those who would expect to see the biggest gain from the change of regime. If Country A's institutional framework hold back productive citizens, it's productive citizens who want to leave. Country A loses its most-valuable resources, continuing their poor economic performance.

I thought of this while driving through the South. With the large-scale migration of rural southern blacks to industrialized northern cities in the early 1900s, those most eager to go would have been the productive and capable who were being held back most by the South's broken institutions. The southern economy suffers, producing a bigger difference with the North and thus attracting even more high-quality workers. (This works for all races, I think: the inefficient economy of the Jim Crow South would give high-productivity whites incentive to leave, as well.)

What you're left with are low-quality workers who won't see a boost to their earnings if they left, and high-racism workers who are willing to take lower wages to continue living in their Apartheid dreamworld. That doesn't sound like a pleasant place to live.

The lesson to learn is this: when high-quality workers start leaving an area, stampede for the door.

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