What do we mean by development? And what are the links to migration? Paul Ladd Adviser United Nations Development Programme March 7 th 2007

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1 What do we mean by development? And what are the links to migration? Paul Ladd Adviser United Nations Development Programme March 7 th 2007

2 Structure Evolution of development concepts and goals Output and income Basic needs Capabilities and freedoms Human rights based approaches The Millennium Development Goals History and recent paradigms Colonialism and imperialism Modernization theory / dependency theory Globalization and neo-liberalism A new meta-narrative? The connection to migration Complex and context specific An example for output and income A balance sheet approach? 2

3 Development concepts and goals Output and income Gross Domestic Product / Gross National Income GNI per capita Used as a proxy for utilityderived from income Basic needs approach to development Food, health, water and sanitation, education and shelter Target resources at the poorest 40% Partly proxies utilityfrom access to essential goods and services; and partly proxies freedomsthat can come from education and good health Recognized by Amartya Sen as one component of the capabilities approach 3

4 Development concepts and goals Capabilities approach Evaluates human well-being Emphasizes functional capabilities resulting from freedoms Has many aspects: economic, political, institutional, access to services, and human rights For example: the ability to engage in economic transactions, to live to old age, and to participate in political activities Poverty is thus understood as capability deprivation Approach has been reflected in the UN Human Development Index, in HRBAs to development, and in the MDGs Human Rights Based Approaches Normatively based on international HR standards, and operationally directed to promoting and protecting human rights Identifies rights and duty bearers; is participatory and inclusive; has a holistic view; and aims for transparency and accountability 4

5 Development concepts and goals The Millennium Development Goals Eradicate extreme poverty and hunger Achieve universal primary education Promote gender equality and empower women Reduce child mortality Improve maternal health Combat HIV/AIDS, malaria and other diseases Ensure environmental sustainability Develop a global partnership for development 5

6 Development concepts and goals The Millennium Development Goals Reflect different types of poverty: not just income poverty, butalso access to services, and the quality of the environment And the fact that it matters who you are: gender, age Arguably, the Goals omit other key aspects of poverty such as inequality, vulnerability, voice, and empowerment But they are a powerful tool - agreed and recognized globally 6

7 History, and recent paradigms Colonialism and imperialism Slavery, indentured labour, and resource extraction to fuel European growth and development Subsequent marginalization of developing countries in global processes and institutions Dependency theory / Modernization theory Dependency theory argues that developing countries are exploited and kept in a state of underdevelopment by developed countries who profit on cheap labour and raw materials Modernization theory highlights the positive role played by the developed world (e.g. aid, technical assistance) in modernizing and facilitating sustainable development in underdeveloped nations 7

8 History, and recent paradigms Neo-liberalism and globalization Emphasis on efficient resource allocation in comprehensive and liberalized markets, underpinned by rapid technological progress especially Information Communication Technologies But asymmetry between liberalization of markets for products and finance on the one hand, and labour markets on the other (did not exist to this extent in earlier phases of globalization) Also, differentiation withinlabour market liberalization preference for skilled workers over unskilled; developed countries want workers not people Concerns that liberalization of markets in the absence of institutions and safety nets (e.g. regulation, insurance, welfare programmes), has led to sub-optimal outcomes 8

9 History, and recent paradigms A new meta-narrative? The Millennium Declaration expresses aspirations of freedom, equality, solidarity, peace, security, development and poverty reduction Guaranteeing rights needs to sit side by side with increasing incomes Growth needs to be accompanied with policies to redress inequality Open markets can help but the poor should not be exposed to sudden liberalization without balancing investments in capacity, market institutions and safety nets Poverty Reduction Strategies can concentrate the minds of governments and donors alike, and should be judged on both content and process 9

10 History, and recent paradigms A new migration and development mantra Migrant remittances more important than ODA Social remittances are also sent home by migrants --skills and attitudes that support development Brain drain replaced by brain circulation and brain gain Emphasis on temporary or circular migration rather than permanent migration Return of migrants stimulates development new skills and investment Facilitating the role of the diasporas in supporting development Stephen Castles 10

11 The connection to migration Migration links to allof these development concepts; and resonates with recent paradigms of development and our experiences with globalization The links are complex and context specific The impacts are not easy to measure some are quantitative and easier to measure, some are qualitative and difficult (or impossible) to measure This presentation tries to use 2 ways to illustrate these links: An example on output and income A possible balance sheet on migration and development links 11

12 The connection to migration Example on Output and Income Are those migrating employed / unemployed in the origin country? If unemployed then output will not go down If employed but in the informal sector then loss in output may not be fully captured (but multiplier effects may reduce formal activity) If employed, skilled or unskilled, then aggregate output will go down If aggregate output goes down then so will tax take and spending Permanent or temporary migration? Permanent migration reduces population in the origin country Permanent migration of unemployed labour would increaseoutput per capita in the origin country Permanent migration of employed labour would reduceoutput per capita in the origin country if those migrating produced more than the average (i.e. if they are skilled and productive) For temporary migration the impact on output may be balanced by reflows of earlier migrants i.e. an ambiguous outcome 12

13 The connection to migration Example on Output and Income Remittances contribute to income of receiving families Families in turn spend remittances and contribute to economic activity through consumption and investment Are remittances per worker greater than lost wages in the origin country? It depends if the worker was unemployed or employed, wage levels, the cost of living in the destination country, and the amount remitted There may also be gender impacts in terms of who controls wages or remittances What is the impact on work effort of remittances? What about the impact of reflows? Do migrants, skilled or unskilled, return? Do they bring additional skills, investment capital? How do diasporas engage: finance, skills, TA, support What are the impacts on growth and income in the long term? 13

14 A balance sheet approach? Positive Ambiguous Negative Remittances Adequately compensate for wages lost? Dependency? Social remittances Brain circulation / gain? But not all values are supportive of development Brain drain of skilled workers Possible training under a co-development approach? Service delivery in deskilled sectors 14

15 A balance sheet approach? Positive Ambiguous Negative Split families: child development fertility behavior Governments set up structures that allow diasporas to vote Diasporas venture capital entrepreneurship Impact on accountability What amounts? Emigrating middle classes make holding origin governments to account more difficult 15

16 A balance sheet approach? Positive Ambiguous Negative The right to migrate to better opportunities, economic freedoms Migrants rights abused, lack of protection systems Disease transfer (e.g. migrant miners in South Africa exposed to HIV and AIDS) etc 16

17 Conclusions Concept of development has broadened in recent years, yet each component links to migration policy and practice Impacts of migration on development are varied and context specific depend on domestic structures and international policies Need to assess this context and include appropriate analysis and policy directions in multi-sector MDG based national development strategies Domestic policy will only take you so far. International policies and systems need to be conducive to development-friendly migration, otherwise sub-optimal outcomes may result Improving efficiency of remittance transfers Systems to protect migrants in transit, and integrate them at destination Agreements (e.g. on pensions transferability) to reduce costs of migration Co-development initiatives (e.g. training and re-skilling) 17

18 Sources Simon Maxwell, Overseas Development Institute, Working Paper 243, January 2005: The Washington Consensus is dead! Long live the meta-narrative! Presentations made by L. Alan Winters (Director of Development Research, World Bank) and (b) Stephen Castles (Co-Director of the International Migration Institute, University of Oxford) at a meeting of the Social Science Research Council s International Committee on Migration and Development Research 18

19 Thank you: 19

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