08 November 2010

On guest worker programs

International migration  is probably  the most  effective mechanism we know  to  rapidly  increase the  incomes  of  poor  people  (Clemens  et  al.,  2008).  However,  it  is  also  one  of  the  most controversial, with migrant-receiving countries worried about  the costs of assimilating workers and  their  families. Temporary or circular migration programs are seen as a way of overcoming such concerns and enabling poorer, less-skilled workers to benefit from the higher incomes to be earned abroad as part of a “triple-win”, whereby migrants, the sending country, and the receiving country all benefit.

Which all sounds great in theory. So David McKenzie and John Gibson evaluated New Zealand’s new (2007) seasonal worker program (using matched difference-in-differences), finding it 

among the most effective development policies evaluated to date. The policy was designed as a best practice example based on lessons  elsewhere,  and  now  should  serve as a model  for other countries  to follow.

Which is great and all, but as I’ve mentioned before, the impacts of migration are pretty clearly positive to me – the challenge and the interesting question is how you change attitudes in rich countries to migration. I worry that the enforceability of temporary migration is a hard sell. I’d like to see how New Zealanders are responding to this program.


Anonymous said...

Well it seems that the two New Zealanders mentioned (McKenzie and Gibson) responded pretty well.

David McKenzie said...

Thanks for the post.
Here is an evaluation from the New Zealand side:

The overall sense is pretty positive from the New Zealand side too - there was little crowding out of New Zealand workers, very low overstay rates, and growers seem to be experiencing some value from the program in terms of workers being more productive when they return for a second season.

In presenting this paper I've been told that enforceability hasn't been much of an issue in the recent German program, and overstay rates have been low in the Canadian scheme as well. So it is possible for well-designed schemes to have low-overstay.

Roving Bandit said...

Thanks, Michael Clemens also sent me this link on the Canadian context - "CSAWP has worked well for 40 years http://bit.ly/coUXhP" - more comments to come once I have to get through this!

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