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Labour Migration (1)

Labour Migration (1)

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Published by imtiaz420

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Published by: imtiaz420 on Nov 10, 2009
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Critically examine the view that labour migration from poor/developing countries could represent the opportunity for theirnational economy
 The issue of labour migration or the “brain drain” is not new,however, it has regained its urgency under the context of increasingglobalisation and maturing economies. There are two aspects to labourmigration: remittances and migration of the skilled caused by theglobalization of education. We will examine both the aspects.Labour migration can be of both types; intra country and intercountry. Labour migration is found to be rapidly increasing since 1990.International migration is a potential way for vulnerable households tochange their standard of living, for better and has been the mostimportant economic factors to affect the relationship between thedeveloping and developed countries. It is seen that over 175 million–roughly 3 percent of the world population people live outside their homecountry. (Richard H. Adams, Jr., 2003:4).Majority of migrants from developing countries, leave their homecountries for higher living standards. It is seen to be beneficial particularlywhen the migrant is unemployed before migrating. Migration is thatimportant international economic aspect which unlike defence oreconomic policies is not co-ordinated by an international organisation.Migration has both direct and indirect effect on poverty Labourmigration can be both the cause and caused by poverty. Also it is true theother way round. Poverty can be mitigated and exacerbated by labourmigration. It depends on the economy of the region on how the interplaytakes place. In some places like the Asian sub-continent migration can bepossible only for people with medium income level, in which scenariomigration helps to alleviate their monetary position. However in theAfrican Sub-Saharan region migration will be the only way of life tosurvive. In which scenario, migration increases poverty. However ourdiscussion will be limited to the earlier part.In the acceding countries themselves, the possible labour marketeffects of accession are seen as ‘double-edged’. Acceding countries withhigh levels of unemployment and low economic growth rates benefit bythe migration of their low skilled and unqualified workers. This reduces their labour force and leaves fewer people without a job. Also, the remittance payments of migrant workers back home have apositive impact on income, consumption and demand. The emigration of higher qualified people, however, may erode a country’s long-termcompetitive position. It is agreed that such a ‘brain drain’ has negativerepercussions on the developmental process of a country (Commission of the European Communities 2002, p. 15). The whole issue of the brain drain has taken on a greatersignificance in recent years in the context of the sustained and rapiddecline in fertility in the countries of the developed world, including thosein eastern Asia. Rapid rates of economic development based on hightechnology industrialization but declining rates of growth in the indigenouslabour force fuel a demand for imported skilled labour.
Globalisation of education:
Education is at the heart of human capital formation. Higheducational attainment is regarded as a positive influence factor onmigration. From a human capital perspective, it is assumed that higherlevels of education offer increased income returns for specific segments of the labour market. It is also argued that higher levels of education providea greater ability to collect and process information, which lowers the riskand increases the propensity of migration.Bauer and Zimmermann (1999) develop the opposite hypothesisbased on an analysis of several international studies of migration. Theyfind an insignificant or even negative coefficient between levels of education and propensity to migrate. This can be explained by theprevalence of low-skilled labour markets for migrants in the destinationcountries, which makes migration for high-skilled individuals lessbeneficial.While the achievement of universal primary education by 2015 isone of the Millennium Development Goals, more advanced levels of education are required for a country to move beyond development basedupon labour-intensive industrialization towards more capital-intensiveactivities. The models of education that are adopted by developingcountries tend to follow those of the developed countries of the west. Thecurricula used may perhaps not be those most appropriate for ruralsocieties, even at basic primary levels of schooling, and those pursuingeducation beyond those levels can most profitably use the fruits of theirlearning in the urban sector. A virtual universal finding of studies of internal migration in 15 developing countries is that rural migrants tourban areas have higher levels of education compared with those in theareas from which they come (Skeldon 1990).An issue quite separate from the types of curricula introduced is theperceived quality of teaching. Concerns about quality of teaching exist not just in rural areas but throughout much of the developing world in general
and this perception can be conceptualized in a hierarchical manner. Ruralparents feel that the quality of teaching is better in the town rather thanthe village, those in provincial towns see schools in capital cities as of ahigher standard, and those in capital cities look to institutions overseas toprepare their children for life in a globalizing economy. Irrespective of whether this perception of educational standard is correct, two criticalfactors enter into the equation: availability of the service and cost. Goodsecondary schools are rarely available in isolated, rural parts of developing countries and the tertiary institutions that are best endowedtend to be located overseas. Even where education is nominally providedby the state or through scholarships, costs are involved where amovement to a school or university away from the home area is involved.As in the case of accessibility, these costs rise in a hierarchical mannerthrough the levels of education, and children leaving their communities topursue their education tend to come from the relatively more advantagedgroups at each level. Education has become a multi-million dollar migrantindustry, particularly at the global level. (Skeldon, 2005) The UNESCO (2005) database provides information on the bilateralstocks of students in higher levels of tertiary education at mostdestinations and allows some insight into the principal sources of studentsin the global system. Of the five countries that dominate the destinationsfor students to pursue tertiary education: It can be seen that
rapid rise inthe numbers of students in Australia in the most recent years for whichdata are available surely cannot be disassociated from that country'spolicy of offering graduates permanent residence status upon graduation(see Hugo 2005).Also, migration of students is seen by some observers as a form of migration of young and qualified labour. In several receiving countries, ithas been easier to switch from a student to worker status than to migrateas fully qualified employee (SOPEMI, 2001; Kofman, 2003).Although the developed countries clearly benefit from themovement of the skilled, it would be difficult to argue that the reason fortheir continuing economic success is predicated upon the importation of skilled migrants from overseas.
Equally, it is difficult to conclude that themigration of students necessarily prejudices the development of thecountries of origin. The reason being the return of a proportion of thosestudents as skilled returnees has surely contributed to the sustainedeconomic growth in that region. Interestingly enough the outflow of skilledmigrants may benefit countries of origin in ways other than through thelater return of some of those migrants with enhanced skills. Stark (2003),in an elegant model, argues that in a closed economy, or a small openeconomy with no migration, there is a tendency to under-invest in humancapital. This tendency is reduced when emigration becomes an option and,despite some losses through migration, the overall average level of humancapital in the economy rises.What does appear clear, however, is that investments are made inhuman capital before the option of international migration becomesavailable and unemployment among the educated is an issue in someeconomies.
 That is, economies in developing countries may have difficultyabsorbing the human capital made available to it. Migration, in this case,becomes an economic safety valve (Skeldon, 2005). If the trainedmanpower does not secure employment in the country it stands as a lostcause to the economy anyway, but the migration at least brings benefit tothe individual migrants and their families. However, the economy, too, can

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