Migrant inflows, capital outflows, growth and distribution: should we control capital rather than immigration?

Emiliano Brancaccio, Andrea Califano and Fabiana De Cristofaro
Additional contact information
Andrea Califano: Università di Milano, Italy
Fabiana De Cristofaro: Scuola Superiore Sant'Anna, Pisa, Italy

European Journal of Economics and Economic Policies: Intervention, 2021, vol. 18, issue 3, 344–363

Abstract: Liberalization policies of international movements of capital and labour have represented a crucial feature of the so-called ‘globalization’ era. More recently, however, several restrictions on migratory movements have been adopted to face the alleged negative effects of immigration. On the contrary, free movement of capital has almost always been preserved. This paper aims to verify whether this current framework of international economic policy can be justified in economic terms. We propose an unprecedented direct comparison between the macroeconomic and distributive impacts of ‘extreme’ episodes of net capital outflows and net migrant inflows in OECD countries between 1970 and 2017. Applying a fixed-effects approach and an event-study approach, we show that GDP growth and functional income distribution have null or even positive statistical relationships with immigration, while they have largely negative statistical relationships with capital flights. More specifically, extreme migrant inflows are not related or in some cases are positively related to real GDP growth, real GDP per capita growth and the wage share, while extreme capital outflows are negatively related to real GDP growth and real GDP per capita growth. These results contrast with current policy agendas and seem to suggest that controls should concern capital movements rather than migratory flows of people.

Keywords: migrant inflows; capital outflows; GDP growth; GDP per capita; wage share; controlsof capital movement or immigration (search for similar items in EconPapers)
JEL-codes: F21 F22 F32 F62 F68 (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.elgaronline.com/view/journals/ejeep/18-3/ejeep.2021.03.08.xml (application/pdf)
Restricted Access

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:elg:ejeepi:v:18:y:2021:i:3:p344-363

Access Statistics for this article

European Journal of Economics and Economic Policies: Intervention is currently edited by Torsten Niechoj

More articles in European Journal of Economics and Economic Policies: Intervention from Edward Elgar Publishing
Bibliographic data for series maintained by Phillip Thompson ().