Question

What are short-run and long-run effects of migration in the sending countries?

Answer 1

Immigrants are people who leave behind their country of origin in order to start a new life in a foreign land. The causes for taking such a drastic step could be numerous. Some might be seeking better employment opportunities, better lifestyle, better education while some might be escaping poverty or conflict zones. Whatever may be the reason, immigration always affects economic planning in the home country. Resource allocation is the key job of the government and immigration largely impacts this area of decision-making.

Short-term effects of immigration on the home country-

• Increase in Financial Reserves through Remittances: Immigrants are known to transfer funds to their people in the home country by way of remittances. The financial support decreases the pressure on the home country's financial resources. Consumption levels are increased sending out a positive outlook for the home economy.
• Temporary distruption of life: The costs of immigration can vary from country to country but the family members who are left behind are almost always affected. There is a time lag between immigrating to another country and receiving the benefits of working abroad.The immigrant will always take time to make sense of things in the new country. An immense amount of time, money and effort may be involved in immigrating abroad, which is always burdensome for the entire family and they have to live with limited means till the immigrant member settles down.

Long-term effects of immigration on the home country-

• Lack of Human Capital: Human capital is the driver of economic growth. It is only through the due diligence of one's people that a nation can strive to move ahead in terms of economic development. The gradual decline in the population will erode the knowledge economy, leaving the home country with reduced productivity.
• Transfer of knowledge: Many people who migrate to another country keep themselves engaged with their home country and return to transfer the skills and knowledge learnt abroad for initiating development in key sectors.