World Population Trends and Their Impact on Economic Development

By Dominick Salvatore | Go to book overview

8
Population Growth and International Migration

GURUSHRI SWAMY

Continued rapid population growth in most developing countries will tend to exacerbate economic disparities between developed and developing countries. Between now and the year 2000, for example, the increase in the number of young adults (aged twenty to forty) in developed countries will be 19 million, less than one-third of what it was during the preceding twenty years. In developing countries the increase will be 600 million, almost one and a half times what it was in the preceding twenty years ( Demeny, 1983). The economic implications of these demographic changes are pervasive. First, even with high rates of domestic savings, there are serious constraints on increasing the amount of capital per worker in most developing countries. If all investment in countries like Bangladesh, Ethiopia, Nepal, and Rwanda had been allocated to potential new workers in 1980, for example, each person would have had less than $1,700 invested on his or her behalf. In the United States, investment per worker would have been close to $200,000. Second, even if per capita income grows faster in developing than in industrialized countries, the absolute income gap will not decrease significantly because the initial difference in per capita income is so large for many developing countries. For example, the absolute gap in per capita income between Indonesia and the United States increased from about $8,000 in 1960 to more than $12,000 in 1981, although per capita income in Indonesia grew at a rate almost double that in the United States.

The links that bind developing and industrialized economies could help narrow these disparities and increase income and employment in developing countries in three main ways: through trade, capital flows, and migration. This chapter makes an assessment of one of these links: international migration. It provides an analysis of the dimensions of past and present-day migration, the nature of constraints on free movement of people, and the effects on and costs and benefits to sending and receiving countries.

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