Published on People Move

Helping people escape from poor geography or poor governance - from World Development Report 2009

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World Development Report 2009, the World Bank's annual flagship, has devoted a significant chapter to the migration of people. “Throughout history, mobility has helped people escape the tyranny of poor geography or poor governance,” argues Indermit Gill, the lead author, “ people and products form the cornerstone of inclusive, sustainable globalization.”

The chapter presents an excellent summary of the literature on migration. A new insight it offers is that "while the returns to scale in agriculture are constant, the returns to scale in manufacturing and services are increasing...A policy maker persuaded by the classical view would restrict the movement of labor...In contrast, a policy maker who recognizes the external benefits of human capital would do exactly the opposite, facilitating migration and clustering, particularly of workers with skills."

Although the authors state the opposite, presumably basing their statement on a lack of evidence in the literature, I suppose this argument about increasing returns to scale also applies to the migration of unskilled labor.


Dilip Ratha

Lead Economist and Economic Adviser to the Vice President of Operations, Multilateral Investment Guarantee Agency, World Bank

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