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Philadelphia. (Photo: Rudy Balasko/Shutterstock)

Migration and Development in an Age of Growing Economic Inequality

• May 19, 2014 • 2:00 AM

Philadelphia. (Photo: Rudy Balasko/Shutterstock)

A dispatch from the “Reinventing Older Communities: Bridging Growth & Opportunity” conference in Philadelphia.

I’m back home from the “Reinventing Older Communities: Bridging Growth & Opportunity” conference in Philadelphia. I have copious notes from the sessions I attended. In the coming days, I’ll archive the presentations and my understanding of the geography of talent migration. Before getting into those details, a few paragraphs about overall impressions. A literature review about the scholarship linking migration and development (PDF):

[E]conomists of the early 1970s were quite interested in migration and development. The most influential work, however, was not on international migration but on domestic, rural-urban mobility (e.g. Harris and Todaro 1970; Fields 1975). An exception to this domestic focus is the seminal theoretical work during this period on the development effects of high-skill international migration (e.g. Bhagwati and Hamada 1974). This interest waned somewhat in the 1980s. It bounced back in the late 1990s, led by theoretical work suggesting that skilled migration could induce human capital investment at the origin (Mountford 1997, Stark et al. 1997, Vidal 1998, Docquier and Rapoport 1999).

The relationship between migration and development starts out as a domestic study and ends up, recently, a preoccupation of people concerned with alleviating global poverty. Digesting the presentations for the conference in Philadelphia, migration as development is missing. The interest in domestic migration has waned to the detriment of policy.

Migration wasn’t absent from the discussion. Every place and every firm wants talent. The debate has moved on quickly from how to attract and retain human capital to the resulting inequality stemming from the concentration of college graduates in a few cities (PDF).

Even geographic mobility is a means to a currency end:

Among the keys to making shared currencies work, according to Robert Mundell, the godfather of optimal-currency theory, is a mobile workforce. Countries tying the monetary knot give up the right to slash interest rates or devalue when stormclouds gather. A slump focused on just one region of the currency zone can therefore last a long time: until falling wages make hiring there attractive once more. But if the jobless can up sticks for sunnier shores, this discomfort can be curbed.

People don’t move to improve. People move to keep the Euro viable. Those involved in international economic development have turned this European Union logic on its head. Place doesn’t matter. People do.

Jim Russell

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