Saturday, June 7, 2014

A Review of Collier's Exodus: Immigration and Multiculturalism in the 21st Century

In this book, Paul Collier, who himself is a descendant of immigrants, provided a comprehensive account of the different controversies surrounding immigration. Relying upon evidence rather than value judgment, Collier’s main argument is that the right question to ask is not about what the overall effects of immigration is but rather what the effects are at the margin. His analysis and observations clearly point out that a rapid acceleration of immigration would yield undesirable results from the points of view of host countries, migrants, and those left behind. He then explicated a set of policies that host countries can implement if they were to keep the rates of migration at bay.

The key driver of immigration, he noted, remains to be the presence of wide income gap between countries of origin and destination. In recent decades, migration had accelerated partly due to the rise in the poor countries’ income which has made migration more affordable. But this slight convergence is not the source of worry. Rather, it is the accumulation of migrants, known as diasporas, in host countries that tends to speed up the rate of immigration. A diaspora is a group of migrants that are yet to be integrated into the society of host countries. They make more migration possible because they help out would-be migrants in their journey to the host country.

Migrants bring with them their culture, creating multiculturalism and diversity. Collier cited Putnam’s social capital work to illustrate how immigration creates diversity. Taken in moderation, diversity is beneficial because it gives people more choices. But at some point, diversity undermines mutual regard, cooperation, and generosity at the host country. Trust is said to be adversely affected in the presence of a highly diverse society. Hence, this is a key rationale for restricting rapid rate of immigration.

Apart from the social consequences, Collier discussed that the net effect on wages of indigenous workers appears to be positive but modest. In the long run, migration tends to lower wages. Because of this, high-skilled indigenous workers are likely to seek better paying jobs elsewhere; and a significant emigration of these workers from their native land, Collier noted, would be catastrophic. He used a hypothetical example of Iceland being emptied of its native population and repopulated with Chinese. Although this is quite an exaggeration, he noted that there would be a global cultural loss if this happens.

Immigration also tends to crowd out indigenous population in accessing social housing although the author did not specifically defined what he meant by social housing. Moreover, immigration also worsens crowding and congestion. Although moderate migration has modest positive economic effects on the indigenous population in the short and medium term, but in the long term, these effects are seen as negligible.

In the role of immigration on salient issues like aging and skills shortages, there are aspects that are noteworthy. Collier pointed out that permanent immigration is a radical way to rectify a temporary imbalance between aging population and increasing dependency ratio. He proposed instead for the emigration of the elderly to other states or the population to spend their assets so that they would be able to import more than they export. This would, he said, likely “release workers who could instead cater for the needs of the elderly.”

So, to Collier, having an aging society does not justify inviting more workers.  Collier attributes the problem to policy ineptitude for failing to account for increasing life expectancy in setting the retirement age. The fact that low skilled migrants also bring their dependents with them vindicates his argument against immigration as a way out of the high dependency ratio problem. Although he cited a study that supports his argument, he fails to mention those that show the importance of immigration in aging societies. For instance, using a macroeconomic model using cases of EU countries, Muysken (2008) illustrated the importance of immigration as a viable policy instrument along with active labor market policies and education policies. Likewise, McDonald and Kippen (1999) also provided evidence using the Australian case of the viability of immigration as a way to mitigate the effects of ageing Australia.

On the use of immigration to fill skill shortages, Collier says that this move weakens the incentive to address lack of training, the root cause of the shortage. The author noted that this aspect has not been adequately studied but in the short run, the unskilled indigenous workers benefit from the coming of the skilled immigrant worker, because then the skills would match, improving on productivity. But in the long run, the indigenes lose because firms do not have the incentive to invest on their training because it is cheaper to import skilled workers. Whether this investment is more likely to happen had immigration not taken place is a good counter-factual to investigate.

Moving on, the winners in immigration, Collier noted, are clearly the immigrants themselves because of the significant leap in their productivity from joining the labour force in high income countries. Although there have been psychological losses brought about by separation with family, it should be clear that the net effects are positive especially when immigrants eventually bring in their family members. But at a rapid rate of migration, migrants themselves lose because this brings in tough competition, resulting to lower wages.

So what about those who are left behind? The most direct effects of migration in countries of origin are the remittances sent by migrants and brain drain. The former is unmistakably the single most apparent gain from migration for those left behind. However, the concern for the latter, Collier noted, is quite misplaced. Even if the number of talent is diminished, this adverse effect is said to be softened by a positive effect which is high return to education investment through remittances and greater opportunities for emigration of other members.  Also, the prospect of emigration induces more investment in education and that is how the brain gain mechanism works.

However, it seems that the issue of brain drain has been downplayed. There has to be clear analysis on which parts of the population are likely to be adversely affected by brain drain. What if a large proportion of those emigrating consist of core functions such as doctors and nurses? There will be limited supply of such workers. This worsens scarcity (driving costs up) in poor countries that have very low capacity to finance public health care. Such is the experience of African countries. Around 10,000 medical professionals from sub-Saharan Africa were reported to have registered in the US in 2011. The Financial Times noted that this is a case of the poorest countries subsidizing medicine in rich countries. The WHO also mentions that migration is an important contributing factor of the brain drain of health personnel in low- and middle-income countries (Taylor, Hwenda, Larsen, and Daulaire, 2011). Therefore, time and nuances are of the essence. It is important to know what is being drained and how quick the system is able to replenish the lost talents.

Also, one of the claims made by Collier is that open door policy will tend to reduce remittances while restrictive ones will increase it. A restrictive policy, he defined implicitly as that which allow only skilled labor to migrate and have strict rules in reunifications. With open policy, migrants particularly the more capable ones will choose not to send remittances but instead bring their family members with them in the host country, thus reducing the remittances sent. If there’s more restriction, there are fewer reunifications and therefore migrants are more likely to send larger amounts. However restrictive policies also limit the migration of the low-skilled which often times are of greater number. Therefore, the effects of restrictive policies on remittances are not that straightforward. Collier also failed to support this argument using empirical data.

On the overall, a rapid rate of migration would have adverse marginal effects on host countries (through increased diversity and reduced cooperation, lower wages, and crowding out in social services), countries of origin (through brain drain), and migrants themselves (through psychological costs and heightened competition). Therefore, Collier concluded that effective controls should be set by host countries which have the practical power because no poor country can and should control the rate of emigration. Collier set a tone of caution for those who have overwhelming enthusiasm for open door policies. A package of policies is therefore necessary to control the rate of migration. He proposed a combination of ceiling, selective policies, integrative policies, and legalization of illegal immigration.

But placing the power of migration policy mainly on host countries is commensurate to failing to acknowledge the role countries of origin play in the creation of, in Collier’s term, dysfunctional social models, which have motivated emigration in the first place. With the gains from remittances, there may not be that much pressure for governments to develop much needed policy reforms. But they are not entirely without means to do more than facilitating emigration. Collier has overlooked their potential role if they work on reforms that have long term economic impact and that provide incentives for their best and brightest to remain at home.

Lastly, the other reviews on this book by Collier share my views that although he provided a balanced take about the consequences of immigration to the different parties (host country, origin, and migrants), his claims usually lack credible empirical support. Indeed, Clemens and Sandefur (2014) in their review noted that “Collier has written a text mortally wounded by incoherence, error, and overconfident leaps to baseless conclusions.” Moreover, because of his aim for comprehensiveness, he often discussed pertinent issues in a shallow manner, failing to account for nuances and the different complexes of migration in varying contexts.
(Photo credit here)


Taylor, A.L., Hwenda, L. Larsen, B. & Daulaire, N. (2011). Stemming the Brain Drain — A WHO Global Code of Practice on International Recruitment of Health Personnel. The New England Journal of Medicine, 365: 2348-2351. DOI: 10.1056/NEJMp1108658

Juma, A. Kangalawe, A. G., Dalrymple, E. & Kanyenda, T. (2012). Case Study #9-11, "Brain Drain of Health Professionals in Tanzania". In: Per Pinstrup-Andersen and Fuzhi Cheng (editors), "Food Policy for Developing Countries: Case Studies." p. 19 URL:

Clemens, M. & Sandefur, J. Let the People Go: The Problem with Strict Migration Limits. (Jan/Feb 2014) Foreign Affairs, 93 (1)
Muysken, J. (2008). Immigration Can Alleviate the Ageing Problem. EIPASCOPE 2008/3:15-18.
McDonald, P. & Kippen, R. (1999). The Impact of immigration on the Ageing of Australia’s Population.‎

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