Description of the Challenge

Migration and Economic Efficiency

In an ideal world, there would be few migration barriers and little unwanted migration. For most of human history, there were few governmental barriers to migration, and the challenge of too many people for available resources and technologies meant that people migrated from one place to another in response to famine, war and displacement in traditional economies. However, migration was often limited by nascent communication and transportation networks as well as institutions and rules from slavery to serfdom.

There was migration in the pre-industrial world, including the great migration of 60 million Europeans to the Americas in the nineteenth and early twentieth centuries. During the twentieth century, the world's population increased fourfold, and sharply different rates of population and economic growth emerged between the world's nation-states, whose number quadrupled to about 200 in the twentieth century. Most nation-states have more workers than formal sector jobs, and young people who know that wages are ten or twenty times higher in another country are especially eager to cross national borders, putting international migration ‘close to the center of global problems’ (Bhagwati 2003a, 82).

If people were goods, the solution to different wage and employment levels would be obvious: encourage the transfer of ‘surplus’ people from poorer to richer nation states, which should benefit individuals whose incomes rise, increase global GDP and promote the convergence in wages and opportunities between sending and receiving areas that eventually reduces migration pressures.