1. L HOTEL Don DeVoretz Simon Fraser University

2. Immigration Triangle Neo-classical model of movement no longer valid Immigration policy and globalization have added choice of movement at each stage Economic incentives for decision to move or to stay altered by – a. human capital investment – b. state subsidies – c. public good entitlements with citizenship 2

3. 3 Figure 1. Immigration Triangle

4. A-B: Sender to entrepot country (Canada) – Entrepot supplies subsidized general human capital (language, job market) specific human capital (certification, credential recognition) public goods (citizenship, public health, education) – Entrepot attracts risk-adverse immigrant from country A A-C: Sender to no-welfare host – Host country supplies: - little or no subsided human capital - public goods: citizenship attracts risk takers: Borjas country Triangular Movement 4

5. Mobility choices Immigrant as myopic maximizer – who at each point must make a decision to stay or to move: if the discounted income and amenities at present location > alternatives, stay; otherwise, move Possibilities – A-B stay; majority are risk-adverse – A-C stay; majority are risk takers – A-A; return migrant who failed or succeeded – A-B-C; risk-adverse onward movement 5 5

6. HOTEL Figure 2. Four-stage Decision Tree

7. Four Stages Stage I: Move or stay in sending country Stage II: Stay in B or move on to A or C – Period 1: entrepot country offers advanced forms of general human capital ( enhanced language training, certification, credential recognition, bridge training, etc.) more or less portable across economies – Period 2: Period of integration (2-15 years or never for citizenship) Agent 2 offers citizenship Stage III: Post-citizenship Accept and stay or move on Reject and stay or return home Stage IV: Choice of final destination 7

8. 8 Reason for Gap in Citizenship Ascension

9. 9 Economic Impact of Citizenship Case I: Overachievers

10. Large for all four cases? Why? –T–Third stage of self-selection accumulates human capital prior to ascension labour market barriers removed end of discrimination? – rate of return on human capital rises To stay or move? –C–Compare post-citizenship earnings to ROW 10

11. 11 Economic Impact of Citizenship Case II: Cross-over

12. 12 Selected Country Older Vintage Canadian Immigrants Age in 1996: 21 to 55 Landing Year: 1960 to 1996 1996 weighted rounded 1996 weighted rounded 5-yr survival 1996 weighted rounded 10-yr survival 2001 weighted rounded 2006 weighted rounded Out- Migration 96-00 Out- Migration 01-05 Australia*9,6009,5209,3908,7408,440780170 China117,880116,720114,930109,780113,9406,940-5,950 France36,28035,94035,42033,27032,1402,670610 Germany51,19050,64049,78048,03047,3102,610-140 Greece38,71038,20037,42036,05037,6902,150-2,420 Guyana56,37055,91055,21054,88054,7101,030-530 Haiti33,45033,17032,74031,75032,1601,420-840 Hong Kong166,690165,450163,570135,310122,15030,14011,280 Hungary13,16013,01012,78011,60011,6501,410-280 India164,780163,330161,110159,840164,1503,490-6,530 Iran32,47032,21031,82027,84027,1604,370290 Italy115,250113,750111,400114,140113,880-390-2,090 Jamaica80,14079,46078,41076,66074,5702,8001,040 Japan*9,6909,6009,4508,6808,300920230 Lebanon43,99043,66043,16041,48040,5302,180450 Netherlands26,26025,96025,50025,51025,720450-670 New Zealand*5,5605,5105,4305,1905,05032060 Philippines132,800131,740130,120128,990128,8902,750-1,520 Poland92,36091,60090,44086,73085,8104,870-240 Portugal106,540105,550104,020102,720101,6202,830-430 Singapore*5,2605,2205,1604,7904,540430190 South Korea30,15029,86029,42027,19026,1202,670630 Sri Lanka46,29045,95045,45042,89041,9003,060490 Taiwan29,46029,20028,80021,85018,4007,3503,050 Trinidad & Tobago45,15044,73044,08042,54041,4902,190400 United Kingdom271,130268,260263,820263,070259,7805,190-1,150 United States134,820133,620131,770121,340117,09012,2802,400 Vietnam102,890102,190101,160103,260105,690-1,070-3,460 Yugoslavia30,96030,67030,23023,70013,9206,9709,340 Table 1. Outmigration of Old Vintage Naturalized Immigrants

13. 13 Selected Country New Immigrants Age in 2001: 21 to 55 Landing Year: 1996 to 2000 2001 weighted rounded 2001 weighted rounded 5-yr survival 2006 weighted rounded Out-Migration 01-05 Australia* 1,440 1,430 s.p.180 China 76,610 76,090 71,8504240 France 9,000 8,950 7,1401810 Germany 3,930 3,900 4,080-180 Greece s.p. Guyana 4,960 4,930 4,86070 Haiti 3,530 3,510 3,860-350 Hong Kong 23,070 22,870 19,5803290 Hungary 1,380 1,36020 India 57,510 57,110 63,160-6050 Iran 18,660 18,510 15,5502960 Italy 1,370 1,360 s.p.110 Jamaica 6,170 6,130 6,260-130 Japan* 3,610 3,590 3,110480 Lebanon 4,890 4,860 4,650210 Netherlands 2,070 2,060 1,880180 New Zealand* s.p. Philippines 33,530 33,310 34,740-1430 Poland 5,240 5,200 5,210-10 Portugal 1,620 1,610 1,830-220 Singapore* s.p. South Korea 14,850 14,730 13,5701160 Sri Lanka 15,110 15,010 14,760250 Taiwan 17,650 17,490 13,8303660 Trinidad & Tobago 3,800 3,770 4,090-320 United Kingdom 10,860 10,780 11,140-360 United States 10,510 10,440 9,990450 Vietnam 7,190 7,160 7,680-520 Yugoslavia 9,690 9,620 4,3705250 Table 2. Outmigration of Old Vintage Naturalized Immigrants

14. Some Trends Few countries show outmigration, and those that do have rates in the double digits: 14 from Canada1996- 2000 2000- 2005 Hong Kong18.2%8.3% Taiwan25%14% United States9%2% Yugoslavia22.7%39% Old Vintage: (Table 1) Post-1960-1996 arrivals New Vintage: (Table 2) Post-1996-2000 arrivals from Canada2000- 2005 Hong Kong14.3% Taiwan20.3% China6% Yugoslavia54.5% Iran16%

15. Positive or Adverse Selection of Canadian Citizens Abroad? Canadians in the United States: –S–Strong positive selection for naturalized Canadians: U.S. resident Chinese-Canadians: + US$56,695 “ “ Indo-Canadians: US$58,050 sub-samples respectively exceed income of all Americans and Canadian-born Canadians –N–No positive selection for Canadian-born Canadians Canadians in Hong-Kong: –S–Strong positive selection for naturalized Canadians 50% naturalized Canadians with post-secondary education vs. 25% of Hong Kong stayers in Canada although they earn less than other returnees, they earn much more than Hong Kong-born stayers in Canada 15

16. HOTEL Conclusions Strong evidence of positive sorting for at least two groups and the triangular model of immigration and citizenship ascension Intervention? –m–majority of immigrants have not left –b–both Canadian-born and naturalized Canadians form the majority of exodus; to date, limited policy response to traditional ‘brain drain’ issue –c–cause for concern: “checking out anytime you like, but never leaving” = retirement with large social benefits Some possible policy responses: –t–tax worldwide income − restrict citizenship inheritance − differential passport fees − provident funds 16

17. Welcome to Canada! The END