Migration's Economic Impacts Explained
Migration's Economic Impacts Explained
ISSN:2706-901X (P)
ISSN:2707-2576 (O)
Review Article
*Corresponding Author Abstract: Migration of persons has increased with time due to easy access to
Elemanya A. Vincent (Phd) more information about better opportunities in other countries and faster
Department of Political Science, means of moving over long distances. This paper critically studies the economic
Ignatius Ajuru University of effects of migration as it affects the individual, the sending and receiving
Education, Rumuolumeni, Port
countries. Therefore, this study adopted the theory of transnationalism in
Harcourt, Nigeria
explaining the movement of people and its economic effects. One of the major
problems of migration in Africa is that of brain-drain and the negative effects
Article History
on the already exploited economies that continues to make them dependent on
Received: 13.11.2022
developed countries. Migration if not properly addressed does pose a lot of
Accepted: 21.12.2022
challenges that sometimes require the joint efforts of two or more nations due
Published: 26.12.2022
to its transnational nature. This is because catering for asylum seekers,
refugees and even internally displaced persons places obligations on
international organisations and countries not directly affected. Even though
there are many reasons that cause people to move from where they have been
residing either voluntarily or against their wish, all such migrations ultimately
impacts on the economic fortunes of all concerned. So that some people’s lives
improve while others encounter more pains and uncertainties due to their
status as refugees, legal or illegal migrants. The study employed qualitative
analysis of data gotten from secondary sources such as books, journals,
newspapers and the internet. It recommends that governments of should
engage effective planning and efficient running of the economy to reduce the
number of highly skilled human resources that regularly leave the country.
Keywords: Migration, remittance, transnationalism, sending country, receiving
country.
Copyright © 2022 The Author(s): This is an open-access article distributed under the terms of the Creative Commons Attribution 4.0
International License (CC BY-NC 4.0) which permits unrestricted use, distribution, and reproduction in any medium for non-commercial use
provided the original author and source are credited.
Under such a definition, those who travel for shorter North America, Australia, New Zeeland, Africa and
periods as tourists and business persons would not South America. The large scale migration of
be considered migrants. Therefore the movement of Europeans continued up to the first part of 20 th
people or group of persons either across an century when activities to colonise underdeveloped
international border or within a State's territory can countries and to exploit their resources received
be classified as migrants. The term migrant was renewed vigour.
usually understood to cover all cases involving
people who move from one place to another for Social Factors
reasons of personal convenience, safety or to Social factors also motivate the migration of
enhance the capacity to cater for themselves through people from one place to another in order to achieve
access to better means of livelihood. It therefore a better quality of life. Thus, migrants sometimes
applies to people and family members, moving to move to have access to better opportunities for
another country or region to better their material or themselves or their family members as regards basic
social conditions and improve the prospect for social services. For example, a lot of people prefer
themselves or their family. sending their children to locations where they can
benefit from comparatively better and safer schools
Causes of Migration or hospitals located out of the country of residence.
The causes of migration are numerous For instance, records showed that about 13,423
ranging from natural calamities, climate change, Nigerian students were part of the international
epidemics, drought, socio-economic, cultural and students in the US in the 2018/2019 academic
political upheaval to the issue of over population. session. This number represents 33 per cent of the
Heavy pressure on resources may be the cause of overall African students in the U.S., making Nigeria
permanent or temporary and long distance or short the leading source of students from the continent
distance migration. Therefore, international and 11th largest country worldwide (Ojeme, 2019).
economic disparities, poverty and environmental This is because in terms of education, the United
degradation, combined with the absence of peace States graduate programmes have a particularly
and security and human rights violations are all strong attraction for young talented individuals
factors that cause international migration. around the world (Kent, 2014). In some cases, some
individuals can migrate in search of health services,
Economic causes such as lifesaving surgery and medical treatment
One of the prime reasons for migration is that are inaccessible in their country (Druzen, 2016).
the need 'for people to improve their economic In some situations wives and children migrate to
condition. Thus unemployment and poverty creates join the head of the family who had earlier relocated
room for people to desire better economic to another country in search of better opportunities.
opportunities which motivates and forces some
people to emigrate from their country of Political Factors
origin/residence. For example, it was mainly An unfavourable political dispensation that
because of economic reasons that slaves, (mostly is characterized by human rights violations,
from sub-Saharan Africa) were transported to intolerance of opposition views, marginalization of
plantations in America and other countries. In some ethnic groups that are the hallmarks of bad
addition, pastoralist and nomads move from the and oppressive governments can also compel people
northern part of Nigeria to the southern part of the to migrate. This is especially so for those who face all
country in search of pasture for their animals in manner of persecution because of their political
order to advance their economic fortunes. In recent affiliation; religious beliefs; cultural orientation and
times, many are also migrating to European nations other factors that put their lives under danger in the
for better wages and more choices that can place of their normal residence. For example,
positively change their economic status. Non- oppressive administrations like that of late General
availability of well-paying jobs and high levels of Abacha, Taliban in Afghanistan, former apartheid
unemployment are also part of the economic regime in South Africa, Saddam Hussein’s targets
reasons which compel the people to leave their against the Kurds in Iraq all contributed to making
home to other countries or regions where people migrate in order to save themselves.
employment may be found (Mishra, 2021). This is
one of the major factors why a lot of Nigerian Environmental Factors
professionals in the educational, medical and Based on issues related to climate change,
engineering sectors are leaving the country in large migration caused by environmental factors is
numbers for greener pastures abroad. One of the increasingly resulting in the displacement and/or
earliest major migrations for economic reason can the forced movement of peoples. According to
be traced to the period of the industrial revolution in Richard (2016), crop failure often result to both food
1779. It was at that time that Europeans migrated to scarcity and a drop in agricultural jobs, prompting
people to move to a place with better jobs can pose serious challenges to a nation’s identity and
opportunities and climate so as to avoid famine and sovereignty.
starvation. Vidal (2012), points out that pollution of
water, air and soil in both urban and rural settings Positive Impact on the Economy of Sending
can also create a serious health risk to locals, forcing Nations
them to look for better life for themselves and their The economic impact of migration comes in
children (Warnwright, 2011). In some situations, it different dimension as discuss below.
is the occurrence of devastating natural disasters
such as tsunamis, hurricanes, flooding or Increases on Domestic Savings
earthquakes that compel people to migrate to safety. Migrant’s remittance increase domestic
For instance, a catastrophic earthquake that struck savings as well as financial inter-meditation
southern Haiti on 7 August 2021 which killed at evidence from Philippines Mexico and other
least 2,200 people resulted in so many homeless countries suggest that remittances increase the
persons who have to move away from the accumulation of assets in farm equipment, promote
devastation towards the Texas border in the US self- employment and increase small business
(Daniels and Phillips. 2021). investment in the migrants sending areas (Taylor J.
E. 1992). Factoring the remittance inflows correctly
Safety Factors into macroeconomic analysis is also likely to
Safety factors can cause danger to improve the credit rating and external debt -
individuals making them to migrate. Persecution and sustainability of the receiving country because they
discrimination based on nationality, race, religion, are a large and stable source of foreign currency,
political, ideology or membership status in a remittances are likely to curtail investors panic
particular social group “Asylum”, (USCIS) well during economic crisis (Burgamelli and Paterno
prompts people to move large distances in search of 2006).
a safer living location where they can have freedom
over their lives. Danger can impose upon individual Furthermore, future flows of remittances
by something formal like war Mercy Corps (2016). can be used as collateral by government and private
Wide spread gang activities. In 2016 the northern sectors in developing countries to raise financing in
triangle composes of Guatemala, Honduras and El- international capital market Ketkar and Ratha
Salvador was name as the most violent region in the (2005). This innovative financing mechanism can be
world. All the three triangle countries recorded used to raise funds for developmental projects such
thousands of crimes by local and international gangs as low income housing or water supply.
and armed criminal groups and most crime were
peipetrated with impurity. It is estimated that Development of Community through Hometown
lopper of the northern triangle’s population has Associations
already left and it is likely that many more will flee Diaspora contributes to the development of
due to extreme crime and violence (Danielle their former communities through hometown
Renwick, 2016). associations and collective financing of development
the income remittances from migrant is not only
Positive Effect of Migration on Social Economic spending on consumptions but on education and
Development of Sending State health. Once in school the children of migrants may
First Development implications of migration be more likely to finish their education as the
for the origin countries. Migration is a decision that increase income from remittances provide
impacts on the welfare of the household, the home additional financial resources and better prospect
community and in the end the whole economy in associated with. Migration influence social norms
various ways Azam and Gubert (2006). The welfare and incentives towards gaining more education.
implications of migration on the origin country are (Cox-Edwards and Ureta 2003 for El- Salvador, yang
most often sizable and positive. The main channels 2008 for Philippines, UNDP 2009). Evidence from
through which migration alleviates poverty are rural Pakistan suggests that temporary migration is
increased incomes from remittances, smooth associated with higher school enrolment especially
consumptions, access to finance for starting new for girls (Mansuri 2006). Furthermore migration has
business, as well as tapping on the knowledge and been observed to increase health knowledge in
resources provided by migrant in Diaspora. Besides addition to direct effect on wealth, which has led to
pure monetary gains, migration remittances allow lower rate of infant mortality and higher birth
for higher investment in health care and education. weight in Mexico (Flildebrandt and McKenzie 2005).
Yet not all impacts are positive. Exploitation of Visiting and returning migrants may also bring back
migrants by unscrupulous recruiters or employers is health - improving practices such as drinking safe
reportedly widespread, separation from family can water and better sanitation (UNDP 2009:19).
be stressful for migrants and large scale immigration
Remittances Reduce the Depth and Severity of $67billion and $36billion, respectively (Oladeji-
Poverty Johnbrowne, 2020). For example, Nigeria’s
Evidence from Latin America, Africa, south remittances in 2017 alone were larger than the
Asia and other regions suggests that remittances combined foreign direct investment (FDI) brought
reduces depth and severity of poverty as well as into the country in the last ten years, as recorded by
indirectly stimulating economic activities of the the National Bureau of Statistics. This is due to a
sending nations. The dramatic increases in combination of factors including more Nigerians
remittances was responsible for one third of the exiting the country to well-paying jobs abroad and a
overall reduction in head count poverty rate in poor investment climate unwelcoming to foreign
Nepal from 42 per in 1995 - 1996 to 31 percent in investors (Rufai, 2019).
2003 - 2004 (World Bank 2006). Remittance from
migrants has an income stabilising effect on both Diaspora bonds represent stable and cheap
macro-economic level and at the household level. sources of external financing especially in times of
Historically, remittances have tended to rise in times financial stress. Diaspora bonds have several
of economic downturns and financial crisis and advantages both for the issuer and for the immigrant
natural disasters because migrants living abroad who buys the bond: Through retailing at small
send money to help their family back home. In denominations, issuers can tap into wealth of
Ghana remittances were found to help households to relatively poor migrants, although Diaspora bonds
minimise the effect of economic shocks on are not necessarily limited to migrants. Migrant are
household welfare (Quartey 2006). Remittance expected to be more loyal than the average investors
receiving household in Ethiopia use their reserves in times of distress. And migrants might be
and thus avoided having to sell their livestock to especially interested in financing, health, housing
cope with drought. Recent evidence from Mali and educational projects. Emigrant may also be an
confirm that a substantial part of remittances is important supply of investment as the knowledge of
saved for unexpected events and the migrants thus their home institutions (perhaps a greater ability to
serves as an insurer to the whole household (Ponsot maneuver within the home country regulatory
and Obengi 2010). framework) may mean that they incur lower
investment costs or higher returns compared to
There are growing indication that projects other international investors.
such as schools, health care facilities and community
infrastructure such as “Tresporun” programme in Effect of Immigrant on Home Political
Mexico (Ghosh 2006: Orozco 2009, World Bank Development
2006, UNDP 2009). Access to information through Several studies in the sociological
the diaspora and the skills learned by returning literatures shows that immigrants are exposed to
migrants can improve technology, management of democratic values and norms and they stimulate
institutions in the sending country, and lower the greater demand for better institutions at home. The
fixed cost and knowledge requirements for setting exposure of migrants to different values, norms and
up an international business (Carling 2005) supply. political behaviors that are relevant and specific to
The Diaspora also serves as link to access the host country can be deployed to contribute to
international financing facilities, and also facilitate the political development of origin. They form
networking. They also contribute through network and are also exposed to media of the host
philanthropic remittances (Goldring, 2004). country with the intention to be politically in tune
and responding accordingly. All this is possible
Important Supply of Foreign Investment because migrants acquire education and valuable
In the current environment of credit crunch experiences they acquire in the destination country
after the COVID-19 pandemic several countries have can really be needed and be of use in the origin
started looking up to the Diaspora as sources of country. Consequently, after some period of time,
foreign exchange inflow (Ketkar and Ratha 2009). they internalise new practices that can have
The overall amount of remittances surpassed foreign substantial impact on their country of origin. In
direct investment flows and more than doubled particular they absorb new political values in a
official aid received by Third World countries. In broader sense that could be with regard to attitudes
many cases, remittances have become the largest towards democracy, gender parity and female
and least volatile source of foreign exchange political participation. Thus, they can return home
earnings (Schiller and Faist, 2010:143). In India, bringing with them new political norms and values
Non-resident Indians (NRI) remittance and so become both sources of supply and demand
contributions to the India GDP stood at 3.4 per cent for changes in political and social institutions. Of
in 2018 and still constitutes a major part of the course the transfer of new political ideas depends on
country’s overall economic development, standing at the political environment of host nations, weather
$79 billion in 2019, followed by China and Mexico those countries are more democratic and liberal and
less corrupt, or more open to accept and implement performance due to less or complete lack of
them (Spilimbergo, 2009). They can achieve these expected parental supervision, which may not be
improvements through sending remittances to effectively administered in single parent household.
finance their preferred candidate, political parties
and politicians. Overall immigrants can demand for Brain Drain
greater accountability and induce positive political Brain drain is the migration of skilled
and institutional changes and more democratic human resources and personnel. Trained
government through the influence they bring to bear professionals are needed in every part of the world.
on the local political scene. A clear example is the However better standard of living and quality of life,
case of the current president of Liberia who was an higher salary access to advanced technology and
international footballer that came back home to more stable political condition is in the developed
contest for the highest political office in his country. countries. The majority of migration is from
developing to developed countries. This is of
Negative effects of Migration on Sending Economy growing concern as it impact negatively on the
Dependency Syndrome and Problem of Reintegration economy of the developing nations (Levy, 2003).
Long reliance on remittances sent by The less developing nations have invested huge
migrants could lead to dependency syndrome. This resources in training professionals, this translate
sometimes makes friends and family of migrants to into loss of resources when this professional migrate
abandon agricultural work. Conversely, the local with direct benefit accruing to the recipients nations
community is depleted of the labour force necessary who have not contributed in educating them. The
to cultivate the land due to the migration of young intellectuals of any country are some of the most
people. In other situations, migration can lead or expensive resources because of their training in
have a knock-on effect on the demand for craft and terms of material cost and time. World Bank Report
services so that local communities suffer from their (2001).
absence. This model is typical of countries with poor
resources for indigenous development, and the gap The movement of skilled workers
between poor sending countries and rich receiving internationally represents brain gain for the
countries could be enhanced by migration (Taylor, countries that reap their skills and experience and
1997) The Phenomenon of returns migration will brain drain for their countries of origin. On the brain
have differential impact depending on who returns. gain side of the destination countries, they are
For example, refugees returning to war-torn and increasingly are looking to position their
dislocated societies may face real problems of immigration policies to attract the types of
absorption and reintegration especially in returning international workers and students whose skills
back to a life of normalcy. In the majority cases, they desire. On the brain drain side, the
economic reintegration of migrants in society of development impacts of losing educated workers are
origin is problematic but this can be mitigated being assessed in immigrant- sending and receiving
through the eagerness of well organised reception to countries benefit so much from the skilled workers
facilitate their return with the hope that it will lead who contribute in various ways to their economy.
to the promotion of local development schemes For example; Dr. Uchechi Iweala, son of the Director-
through the application of the experiences acquired General of the World Trade Organisation, Ngozi
abroad. Okonji-Iweala, broke a medical record in Maryland,
United States as one of the first spinal surgeons in to
Alteration of Family Composition perform a successful navigated lumbar spinal fusion
Though migration remittances increases using a robot (Edeme, 2021).
household incomes which may lead to reduction in
child labour and increase educational attainment for DISCUSSION OF FINDINGS
children, on the other hand migration alters family Remittances are good, but they only provide
composition and roles within the family which may some financial compensation for the migrant who
have adverse effect on the educational success and will prefer to make such money in his or her country
educational outcomes for children of migrants who of origin in order to enjoy all the benefits of
often grow up under a single parent. This may make citizenship, family and friends support as well as
them confront future problems of family avoid the unpleasant experiences of discrimination,
disintegration and family stress. Moreover migration exploitation, racism, unnecessary harassment from
may cause a shift in adolescent’s orientation, in the immigration officials of the country he or she is
sense that children may consider migration as their living in as a migrant, imprisonment or even death.
ultimate goal and decide to pursue further education
in order to increase their migration prospect and Although, the amount of remittances into
probability (Vidal 2012). Children growing up in Nigeria have continued to grow over the years, they
single parent households have poorer school are mainly used for family support so that those left
behind by the migrant can live a relatively better life, formulating policies that will thoroughly
enjoy improved levels of education and possibly utilize remittances in ways that will
invest some of it in small businesses or property. In contribute to generating employment,
essence, most countries like Nigeria that receive reduce poverty and lead to economic
large amount from remittances are yet to growth. Therefore, Nigeria needs to make
consciously formulate strategic policies that will use better use of the remittances, skills and
them to boost economic growth. experiences of migrants to achieve
greatness in all spheres of endeavours.
The net effect of migration of skilled labour 2. To reduce the high rate of loss of skilled
is the loss of people whose contributions towards a manpower, strategic measures through
vibrant economy. These migrants who are more proper policy formulations that will turn the
needed in their country of origin to assist in turning trend of migration in order that the country
things around for the better end up using their can benefit much more from the education
training and experience to further the advancement and experiences of her citizens.
of already developed countries that continue to 3. Receiving countries should also
exploit developing ones. acknowledge the contributions of migrants
to their economy and treat them with a
The state of the economy of the sending and human face.
receiving countries greatly determine the rate of
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