What do you think about migration, economist?

Strolling Economist meets Accidental Photographer / #4

P: Look economist, an old photo.

E: Hm.

P: I took it in Berlin on the day of the federal election in Germany, on September 24, in 2017. I got my hands on it the other day and thought of a question to ask you.

E: Ask, photographer.

P: What do you think about migration?

E: Can you be a little more specific, please?

P: The number of refugees coming to Germany has risen sharply recently.

E: So what?

P: Well, how is that to be seen economically? Is this a problem?

E: I guess you won't get any more precise. So I want to tell you something. There is pretty good empirical evidence that nothing increases people's prosperity in the short term more than migration. That is why migration has always existed. As a rule, migration brings enormous advantages for the migrants.

P: I see. But what about the people in the country the migrants are going to? What are the implications there?

E: It is important to distinguish between two forms of migration: labour migration and refugee migration. Taking in refugees in need is a commandment of charity. We help others. This is not about making ourselves better off. So in the case of refugee migration, wealth is redistributed; it moves from the rich to the poor. That is different from labour migration. When people migrate and find a job, benefits are always mutual. The great thing about the market economy is that everyone involved benefits. A contract, including an employment contract, only come about if it is advantageous for both parties, the employer and the employee. To sum it up: Migrants migrating into markets are overwhelmingly beneficial for the country where the people immigrate.

P: Sounds good in theory. But what about practice?

E: I am a man of theory. 

P: ... living a daily life.

E: Ok, listen. I admit things are more complicated in real life. For example, it is not always possible to distinguish precisely between labour and refugee migration. And who was a refugee yesterday can be in the job market today. There was a so-called wave of refugees in Germany in 2015. Today, half of these people have a job.

P: And the other half doesn't. 

E: Remember, we took in the people to help. By migrating into the labour market over time, not only the migrants benefited but the whole country of Germany.

P: I can see you're a friend of the market economy and of migration.

E: You're pretty much right.

{silence} 

P: Hey, economist. 

E: What else?

P: Do you remember when the war in Ukraine started last year, and many Ukrainians fled our country?

E: I do. I’ve just read that 1.07 million refugees from Ukraine live in Germany today, more than in any other EU country.

P: In any case, back then, do you remember that people were asked to provide their own living space, I mean to house the refugees privately?

E: I remember as well. 

P: Did you also think about taking in refugees back then?

E: I did. 

P: And?

E: I didn't take any. 

P: Neither did I. 

P: Are you sometimes a bit ashamed of it?

E: Sometimes. 

P: Me too.