We don’t really know what a borderless world would look like – one in which labor is allowed to move freely. Those against immigration in rich countries cite fears such as the burden immigrants pose on social welfare systems and public services, increased competition and potential job loss for existing low-income workers, and distortion of national identity; those in poor countries are afraid of “brain drain”.
What we know is what a world with barriers to labor mobility looks like and such a world is not looking prettier– depriving people the opportunity to participate in a global system and to reach their potential is resulting in a world fraught with inequalities that pose a fertile ground for more conflict and insecurities.
As Lant Pritchett writes, “despite irresistible forces creating pressure for increased labor mobility, immovable ideas in rich countries have largely prevented it.” The irresistible forces are demographics – ageing population in rich countries and the need for young tax-payers to fuel the economy- and the growing income inequality between rich and poor countries; the immovable ideas are the anti-immigration sentiments.
The pressure for integration will keep building up as in a dam and may burst at any time – there is a need to ease this pressure off by exploring avenues that allow for more mobility. We need to overcome the fear of what may happen to improve upon what we currently have.
Allowing for more international mobility of workers holds huge gains for the global economy. Michael Clemens, who leads the migration and development initiative at the Center for Global Development, argues that the world impoverishes itself much more through blocking international migration than any other single class of international policy. The gains to eliminating barriers to human mobility amount to large fractions of world GDP, much greater than eliminating all remaining restrictions on international flows of goods and capital, Clemens finds.
Walmsey, Winters and Ahmed estimate that a 3 percent increase in migration of labor force from developing to developed countries would increase global GDP by USD 288 billion. Pritchett estimates that even a small liberalization of international migration is close to twice the combined annual benefits of full trade liberalization ($86 billion), foreign aid ($70 billion), and debt relief ($3 billion).
Despite huge economic gains, the issue of increased labor mobility remains highly contentious. Any suggestion for more flexible labor policies need to not only improve economic welfare but also be politically palatable in rich countries.
Clemens points out several policies that have been proposed by economists: Lant Pritchett proposes temporary guest-worker agreements negotiated bilaterally where rich countries certify labor shortages in specific industries and labor-sending countries ensure that temporary workers return home after their assignment. Pia Orrenius and Madeline Zavodny emphasize work-based immigration to create win-win situation and suggest raising permanent economic visa allocations. Jesús Fernández-Huertas and Hillel Rapoport propose tradable immigration quotas. Last but not the least, Clemens proposes using migration policy as one tool to assist people in poor countries struck by natural disaster.
While the idea of free labor mobility may seem fanciful or even implausible at the present, who is to say that it has to continue this way? Any restriction the world has today – aren’t these our own constructions? If 150 years ago you had said that women in most part of the world would be voting, you would have been laughed at.
Change begins with an idea. We are the only ones standing in our way towards making this change.