Question

In what respect is the economic decision to move across international borders an investment decision? Why do economic migrants move to some countries but not to others? How do distance and age affect the migration decision? How does the presence of a large number of previous movers to a country affect the projected costs and benefits of subsequent movers?

Answer 1

The individuals tend to take the decision to move across international borders because of the motive to earn more income. The individuals move to another country where they expect that they will earn higher wages. The primary purpose of migrating to another country is high wages. As individuals expect to earn higher wages more than the cost incurred in moving to another country, they make an investment decision. By initially investing in the costs of migration, they earn higher income later.

The economic migrants only move to that country where they expect higher wage differential than the domestic country. The migrants only move to another country for earning a higher income, and if they are not getting higher wages, then there will be no point in moving. Therefore, the migrants do not move in the country where the level of wages is the same or lower than the domestic country.

The age of the migrants has an inverse impact on the migration decision. Older people tend to travel less than younger people. Therefore, with the growing age of the individual's migration reduces.

Distance also has a huge impact on the migration decision taken by individuals. The shorter the distance, the more is the tendency to move to migrate. When the distance to the migrating country is more, the cost of migration also increases that reduces migration.

The presence of a large number of previous movers to a country reduces the benefits of the subsequent movers. If there are a large number of the previous mover already present in the country, then the chances of getting a job reduces and the wage level of that country also reduces. This makes the benefits of subsequent movers lower. The cost of the subsequent mover increases when there are a large number of migrants present. There is an increased cost of living when a country has a high level of the population as the wages of that country is lower.