Key Question 1b: What is the relationship between patterns of international migration and socio-economic development?

Key Question 1b: What is the relationship between patterns of international migration and socio-economic development? Learning Objective: To assess the role migration plays in the socio-economic development of countries. 1. What are the contemporary patterns of global migration? Key Ideas Content 1b. Current patterns of international migration are related to global patterns of socio-economic development. The relationship between patterns of international migration and socio-economic development, using national indices such as ‘value of migrant remittances’ and HDI.

Migration can contribute significantly to development. It can be a positive process for stability; economic growth and socio-economic change. Inequalities can also be a cause of migration – think about Friedmanns “Core-periphery” model. Inequality can have a significant impact on the direction and scale of migrant flows.

A remittance is a transfer of private funds/money by a foreign worker to an individual in his or her home country. Money sent home by migrants competes with international aid as one of the largest financial inflows to developing countries. Workers' remittances are a significant part of international capital flows, especially with regard to labour-exporting countries. They are very important in the development process and are of particular significance to the poorest countries.

Migrant Remittances Remittances Ted talks Remittances

Top Remittance Receiving Countries, 2015 in $US Billions, (World Bank) What does this bar graph actually show? What countries are you surprised about? What countries were you expecting to see here? Why are ‘AC’ countries like the UK receiving $5 billion in remittances? What does this tell us about Migration?

The Wealth of Country Income– Measured by GDP per Capita (the total value of all goods and services produced in a country divided by it’s total population) What influence do these Remittances have on a countries GDP? They increase a country’s GDP. They are a sources of foreign exchange which can contribute to economic stability. They can supplement a household’s income, stimulate consumption, provide funds for a local investment and stimulate local multiplier effects in the country of origin.

Human Development Index (HDI) Human Development Index (HDI) is an index used by the UN to rank countries by level of "human development“ based on economic and social indicators. The HDI combines measures of:   Income– Measured by GDP per Capita (the total value of all goods and services produced in a country divided by it’s total population) Knowledge– Measured by Adult Literacy and the % of children attending school. Longevity– Measured by Life Expectancy at birth. HDI value lies between 0 – 1. The closer to 1 the  more developed the country.

Human Development Index (HDI)

GDP Per Capita, 2015 Life Expectancy, 2015

Migrant Remittances as a percentage of GDP and HDI for selected countries, 2013. What trends can be identified here? What level of development are the countries most benefited by migrant remittances?

Globally there is a relatively strong inverse relationship between receipt of migrant remittances and HDI. Migrant remittances to the more advanced countries, with higher HDI, are a lower % of GDP e.g. UK and USA. LIDCs and EDC’s represent a higher proportion of GDP and therefore are of great significance to their economy and development. For example, they constitute around 20% of GDP in LIDCS like Haiti, The Gambia and Liberia. These are all countries with relatively low HDI E.g. In 2013 the following $US were sent as remittances to: US$ 6.69 billion was sent to the USA (AC) (less than 1% of GDP). US$ 69.97 billion was sent to India (EDC) (3.7 % of GDP). US$ 1.78 billion was sent to Haiti (LIDC) (21.1% of GDP).

Important things to remember about Spearman’s rank: This is a reliable and objective way to see if there is a relationship between two sets of data shown on a scatter graph. Just because a scatter graph may indicate a positive or negative relationship, these graphs give us no idea of the strength of this relationship. This is worked out by calculating the ‘Spearman’s rank Correlation Coefficient.’ Important things to remember about Spearman’s rank: You must always set up a null hypothesis You need between 7 (some say 10) and 30 sets of paired data. You must test the significance of the Spearman’s rank correlation coefficient. You then need to interpret the result and accept or reject the null hypothesis.

Method Always formulate the ‘null hypothesis’ (Hᴏ) which must state the absence of a relationship between the 2 variables that you are investigating. Then formulate the ‘alternative hypothesis’ which states the presence of a relationship. **Hopefully you will be able to reject the null and accept the alternative **

Method 3. Rank the data. – if shared values exist, calculate the average rank. 4. Calculate ‘d’ which is the difference between the 2 ranks for each pair of data. 5. Calculate d² and then the sum of d². 6. Then use the formula to calculate spearman’s rank coefficient. The coefficient will always within a range that extends from +1 (perfect positive) to -1 (perfect negative). The greater the value of rs, the stronger the relationship between the 2 variables e.g. +/- 0.750 represents a stronger correlation than say +/- 0.532. 7. There is always a possibility that a result is due to chance and in statistical terms, a result is only truly significant when it can be demonstrated that it could not occur by chance. Results must always be tested for significance i.e. the probability of chance having influenced the result. 8. Calculate your degrees of freedom and set your critical value to see if your values is significant.

Review There is an increasing recognition that migration can be a factor in in the promotion of international development. The extent to which there is a causal relationship between remittances and socio-economic development depends on how migrant remittances are used. The money often has the effect of lifting families back home above poverty levels. It may be spent on improving housing and quality of life or invested in small-scale local business enterprises such as retailing. It can help to stimulate the economic multiplier effect by creating local employment opportunities and it may enable easier access to transport, health and education services all of which improve their future prospects.

Homework Review questions What are the specific reasons for increased intra-regional migration following the expansion of the EU since 2004? 2. What are migrant remittances and how can they contribute to development?