Research suggests that immigration can be beneficial both to the receiving and sending countries. Research, with few exceptions, finds that immigration on average has positive economic effects on the native population, but is mixed as to whether low-skilled immigration adversely affects underprivileged natives. Studies suggest that the elimination of barriers to migration would have profound effects on world GDP, with estimates of gains ranging between 15 and 67 percent for the scenarios in which 37 to 53 percent of the developing countries' workers migrate to the developed countries.Other studies show a larger change in global GDP, but the 15 to 63 percent range is used to keep it relevant to the percentage of developing countries' workers who migrate to developed countries.
Some development economists argue that reducing barriers to labor mobility between under-developed, developing and developed countries would be one of the most efficient tools of poverty reduction. Positive net immigration can soften the demographic dilemma in the aging global North.
Study methodologies David Card's 1990 work – considered a landmark study in the topic – found no effect on native wages or employment rates. It followed the Mariel boatlift, a natural experiment when 125,000 Cubans (Marielitos) came to Miami after a sudden relaxation in emigration rules. It lacked the limitations of previous studies, including that migrants often choose high-wage cities, so increases in wages could simply be a result of the economic success of the city rather than the migrants. But the Marielitos chose Miami simply because it was near Cuba rather than for lucrative wages. Preceding studies were also limited in that firms and natives may respond to migration and its effects by moving to more lucrative areas. However, the six-month period of this migration was too brief for most firms or individuals to leave Miami.
Another natural experiment followed a group of Czech workers who, shortly after the fall of the Berlin wall, were suddenly able to work in Germany though they continued to live in Czechia. It found significant declines in native wages and employment as a result. It is argued migrants must also spend their wages in the employing country in order to stimulate the economy and offset their burden.
Global According to economists Michael Clemens and Lant Pritchett, "permitting people to move from low-productivity places to high-productivity places appears to be by far the most efficient generalized policy tool, at the margin, for poverty reduction". A successful two-year in situ anti-poverty program, for instance, helps poor people make in a year what is the equivalent of working one day in the developed world. A slight reduction in the barriers to labor mobility between the developing and developed world could do more to reduce poverty in the developing world than any remaining trade liberalization. Studies show that the elimination of barriers to migration could have profound effects on world GDP, with estimates of gains ranging between 67 and 147.3%. Research also finds that migration leads to greater trade in goods and services, and increases in financial flows between the sending and receiving countries.
Greater openness to low-skilled immigration in wealthy countries could drastically reduce global income inequality. According to Branko Milanović, country of residency is by far the most important determinant of global income inequality, which suggests that the reduction in labor barriers could significantly reduce global income inequality.
State A survey of European economists shows a consensus that freer movement of people to live and work across borders within Europe makes the average European better off, and strong support behind the notion that it has not made low-skilled Europeans worse off. According to David Card, Christian Dustmann, and Ian Preston, "most existing studies of the economic impacts of immigration suggest these impacts are small, and on average benefit the native population". In a survey of the existing literature, Örn B Bodvarsson and Hendrik Van den Berg write, "a comparison of the evidence from all the studies... makes it clear that, with very few exceptions, there is no strong statistical support for the view held by many members of the public, mainly that immigration has an adverse effect on native-born workers in the destination country."
Research also suggests that diversity and immigration have a net positive effect on productivity and economic prosperity. Immigration has also been associated with reductions in offshoring. A study found that the Age of Mass Migration (1850–1920) contributed to "higher incomes, higher productivity, more innovation, and more industrialization" in the short-run and "higher incomes, less poverty, less unemployment, higher rates of urbanization, and greater educational attainment" in the long-run for the United States. Research also shows that migration to Latin America during the Age of Mass Migration had a positive effect on long-run economic development. A 2016 paper by University of Southern Denmark and University of Copenhagen economists found that the 1924 immigration restrictions enacted in the United States impaired the economy.
The view that economic effects on the average native tends to be only small and positive is disputed by some studies, such as a 2023 statistical analysis of historical immigration data in Netherlands which found economic effects with both larger positive and negative net contributions per capita depending on different factors including previous education and income of the immigrant.Borderless Welfare State, The Consequences of Immigration for Public Finances, Jan H. van de Beek, Hans, Roodenburg, Joop Hartog, Gerri W. Kreffer, 2023, Demo-Demo publisher, Zeist, Netherlands, , Statistical data by Project Agreement 8290 Budgetary consequences of immigration in the Netherlands (University of Amsterdam and CBS Microdata Services, 19 June 2018) Effects may vary due to factors like the migrants' age, education, reason for migration, the strength of the economy, and how long ago the migration took place.
Low-skill immigration has been linked to greater income inequality in the native population, but overall immigration was found to account for a relatively small share of the rise of native wage inequality. For example, according to a study, immigration was only responsible for 5% of the increase in wage inequality in the US between 1980 and 2000.
Measuring the national effect of immigration on the change of total GDP or on the change of GDP per capita can have distinct results.Jiří, Mazurek. "On some issues concerning definition of an economic recession." (2012).
Emigrant Research suggests that migration is beneficial both to the receiving and sending countries. According to one study, welfare increases in both types of countries: "welfare impact of observed levels of migration is substantial, at about 5% to 10% for the main receiving countries and about 10% in countries with large incoming remittances". A study of equivalent workers in the United States and 42 developing countries found that "median wage gap for a male, unskilled (9 years of schooling), 35-year-old, urban formal sector worker born and educated in a developing country is P$15,400 per year at purchasing power parity". A 2014 survey of the existing literature on emigration finds that a 10 percent emigrant supply shock would increase wages in the sending country by 2–5.5%.
Remittances increase living standards in the country of origin. Remittances are a large share of the GDP of many developing countries. A study on remittances to Mexico found that remittances lead to a substantial increase in the availability of public services in Mexico, surpassing government spending in some localities.
Research finds that emigration and low migration barriers has net positive effects on human capital formation in the sending countries. This means that there's a "brain gain" instead of a "brain drain" to emigration. Emigration has also been linked to innovation in cases where the migrants return to their home country after developing skills abroad.
One study finds that sending countries benefit indirectly in the long-run on the emigration of skilled workers because those skilled workers are able to innovate more in developed countries, which the sending countries are able to benefit as a positive externality. Greater emigration of skilled workers consequently leads to greater economic growth and welfare improvements in the long-run. The negative effects of high-skill emigration remain largely unfounded. According to economist Michael Clemens, it has not been shown that restrictions on high-skill emigration reduce shortages in the countries of origin.
Research also suggests that emigration, remittances and return migration can have a positive effect on political institutions and democratization in the country of origin. According to Abel Escribà-Folch, Joseph Wright, and Covadonga Meseguer, remittances "provide resources that make political opposition possible, and they decrease government dependency, undermining the patronage strategies underpinning authoritarianism." Research also shows that remittances can lower the risk of civil war in the country of origin.
Research suggests that emigration causes an increase in the wages of those who remain in the country of origin. A 2014 survey of the existing literature on emigration finds that a 10 percent emigrant supply shock would increase wages in the sending country by 2–5.5%. A study of emigration from Poland shows that it led to a slight increase in wages for high- and medium-skilled workers for remaining Poles. A 2013 study finds that emigration from Eastern Europe after the 2004 EU enlargement increased the wages of remaining young workers in the country of origin by 6%, while it had no effect on the wages of old workers. The wages of Lithuanian men increased as a result of post-EU enlargement emigration. Return migration is associated with greater household firm revenues. Emigration leads to boosts in foreign direct investment to their home country.
Some research shows that the remittance effect is not strong enough to make the remaining natives in countries with high emigration flows better off.
Fiscal A 2011 literature review of the economic effects of immigration found that the net fiscal effect of migrants varies across studies but that the most credible analyses typically find small and positive fiscal effects on average. According to the authors, "the net social impact of an immigrant over his or her lifetime depends substantially and in predictable ways on the immigrant's age at arrival, education, reason for migration, and similar". According to a 2007 literature review by the Congressional Budget Office, "Over the past two decades, most efforts to estimate the fiscal implications of immigration in the United States have concluded that, in aggregate and over the long term, tax revenues of all types generated by immigrantsboth legal and unauthorizedexceed the cost of the services they use." A 2022 study found that the sharp reduction in refugee admissions adversely affected public coffers at all levels of government in the United States.
A 2018 study found that inflows of asylum seekers into Western Europe from 1985 to 2015 had a net positive fiscal effect. Research has shown that EU immigrants made a net positive fiscal contribution to Denmark and the United Kingdom. A 2017 study found that when Romanian and Bulgarian immigrants to the United Kingdom gained permission to acquire welfare benefits in 2014 that it had no discernible effect on the immigrants' use of welfare benefits. A paper by a group of French economists found that over the period 1980–2015, "international migration had a positive impact on the economic and fiscal performance of OECD countries."