Labor mobility - Research Paper Example

Frank Barry said that in the Harris-Todaro approach, perfect labor mobility is assumed (Fodders and Langhammer, 2006 p. 37). Here, migration utilizes utility across locations and it results to complete depopulation. This kind of perfect mobility yields a restrictive result, however, outside options will be held constant, the individuals welfare will be affected. To have a simpler model, let us consider Ehrenberg’s and Smith’s (2003) definition of mobility as an investment with costs at the start in exchange for future earnings or returns in the long run.

The mobility decision is influenced by the benefits that will be acquired minus the costs of moving. Ehrenberg and Smith (2003) mentioned that the theory of human capital predicts the direction of migratory flows among workers. Labor will move to economies that offer higher earnings but this does not imply that their place origin has the worst opportunities available. Wage differential is one the reasons that labor migration occur. Table 1. Educational Attainment of Persons Going Out of the United States: 2009 to 2010 Educational Attainment Total Not a high school graduate 109,000 High school graduate 87,000 Some college or AA degree 76,000 Bachelor’s degree 166,000 Prof.

or graduate degree 122,000 Persons age 1-24 385,000 Source: U.S. Bureau of Census, Geographical Mobility: 2009-2010, Table 1, http://www.census.gov/hhes/migration/data/cps/cps2010.html Education is the best determinant as to who will move within an age group (Ehrenberg and Smith, 2003). As we can see from Table 1, people having a bachelor’s degree are more likely to go abroad. With globalization and the continued advancement of technology, looking for job opportunities abroad will be easier especially for persons with a college degree or higher.

They are considered as high-skilled laborers (Vinokur, 2006) belonging to the professional, technical, and kindred or related workers (Martin, Abella, and Kuptsch, 2006 p. 55). Radcliffe (2009) cited several ways how immigration could affect a recipient country’s economy. First, there will be an increase supply of labor. The arrival of migrant workers will increase the total labor supply of the recipient country. If labor demand will not increase, the increase in labor supply will result to a decrease in wage rates.

Also, if available jobs will remain the same, the rise of labor supply will result to unemployment. There is also a positive effect that is brought about by immigration to the host country since some laborers added have specialized skills. These skills will contribute to the increase of productivity in their areas of concern. Most economists perceive that having immigrants will be beneficial to the country of origin for three reasons (Martin et al, 2006 p58). First, production loss especially in boom sectors will be minimized since the migrants can work on the vacant jobs until more local workers are trained.

Second, they can increase the diversity of work teams contributing to the increase of productivity. Lastly, they can hold down wage increases in their concerned sectors. Though this can be can be considered a loss to the local workers, this can be beneficial to the local populace since this would also imply that the price of the services they provide will still be easier to pay. In the perspective of the country of origin, the movement of their labor force outside the country is viewed in another manner.

Brain drain