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August 2011

Are migrants more likely than nationals to be unemployed during economic crisis?

Sudharshan Canagarajah's picture

There has recently been heated debate regarding migrant employment behavior in host countries during and after economic crises. The popular view is that migrants have an incentive to remain unemployed as long as they have access to unemployment benefits, free health care, and education. Thus, many argue, that migrants should not be provided with benefits as they create perverse incentives for migrants to stay unemployed. However, recent data does not support such a simple relationship. In fact recent data shows that sometimes migrants that lose jobs tend to find work quickly during and after crises.

A recent article in the Economist based on OECD Migration Outlook 2011 provided some useful data to show the complex patterns of migrant unemployment compared to nationals. The data shows that the relationship between migrants and unemployment incidence depends on a variety of labor market conditions including unemployment benefits, skill level of migrants, business cycle patterns, the sectors they are employed in, and labor market flexibility.

Ethiopia’s new diaspora bond: will it be successful this time?

Sonia Plaza's picture

According to the latest issue of the Economist, diaspora bonds an idea worth trying. Ethiopia recently announced the launch of its second diaspora bond: “Renaissance Dam Bond”.

The proceeds of the bond will be used to fund the construction of the Grand Renaissance Dam. This dam will be the largest hydroelectric power plant in Africa when completed (5,250 Mega Watts). The first one was called the Millennium Corporate bond, and was for raising funds for the Ethiopian Electric Power Corporation (EEPCO) . The first diaspora bond issuance did not meet the expectations. Sales were slow during the first months of offering despite the efforts of the Commercial Bank of Ethiopia and the embassies and consulates to sell them. Some risks that the diaspora faced were: i) risk perceptions on the payment ability of EEPCO on its future earnings from the operations of the hydroelectric power; ii) lack of trust in the government as a guarantor; and iii) political risks.

Enlist the diaspora – and remittance service providers – for fighting malaria

Dilip Ratha's picture

Diaspora members and remittance service providers (RSPs) can potentially help the global fight against malaria and other diseases. It is well known that migrants send extra money home for buying medicine and medical services. But medical care for the family members alone is not enough to keep them safe from malaria and other communicable diseases that can spread from elsewhere in the community. Migrants, therefore, may be willing to contribute to fighting diseases at the community level. Only there isn’t an easy way for a diaspora member to contribute to such efforts.

Are fewer Mexicans crossing the border to the United States?

Sonia Plaza's picture

Migration flows in both directions between the United States and Mexico have diminished according to recent statistics released by the Mexican and United States governments.

Mexican immigration to the United States began to decline in the mid-2006, and that pattern has continued into 2010. The Pew Hispanic Center analysis of Mexican government data indicates that the number of Mexicans annually leaving Mexico for the U.S. declined from more than one million in 2006 to 404,000 in 2010. Rand Corporation also found that the Mexican immigrants returning to Mexico have not increased despite the crisis.