New economics of labor migration

Definition

The new economics of labor migration is a theory that emphasizes the role of household and family-level decisions in the migration process, positing that individuals migrate not only for personal economic gain but also as a strategy to improve their family's financial stability and welfare. This approach highlights the significance of remittances and how they create economic ties between the U.S. and Latin America, as migrant workers often send money back home to support their families.

5 Must Know Facts For Your Next Test

1. Remittances sent by migrants from the U.S. to Latin America represent a significant source of income for many households, often surpassing foreign direct investment in certain countries.
2. The new economics of labor migration shifts focus from individual motivations to collective family strategies that view migration as a way to diversify income sources and mitigate risks.
3. Research shows that remittances can lead to improved education, healthcare access, and overall living standards in home communities, demonstrating the positive impacts of migration.
4. Migrant workers often play an essential role in maintaining their family's economic stability through remittances, which can contribute to local economic development in their home countries.
5. The theory also highlights that migration can be a response to failures in local economies, pushing families to seek better opportunities abroad for survival and growth.

Review Questions

• How does the new economics of labor migration explain the motivations behind migration decisions at the household level?
  • The new economics of labor migration explains that migration is often a collective decision made by families rather than just individuals acting on personal interests. Households consider the potential benefits of sending a member abroad, such as increased income through remittances, which can provide financial security and improve living conditions for the entire family. This perspective highlights the importance of family networks in shaping migration patterns and decisions.
• Discuss the role of remittances in the context of the new economics of labor migration and their impact on economic ties between the U.S. and Latin America.
  • Remittances are a crucial component of the new economics of labor migration, as they serve as a lifeline for many families in Latin America. Migrants send substantial amounts of money back home, which helps sustain households and contributes significantly to local economies. The flow of remittances reinforces economic ties between the U.S. and Latin American countries, creating interdependencies that affect both regions' economic dynamics and social structures.
• Evaluate how the new economics of labor migration provides insights into both the challenges and opportunities faced by migrants and their families in the context of global economic changes.
  • The new economics of labor migration offers valuable insights into the complexities surrounding migration in an ever-changing global economy. It underscores that while migrants face challenges such as discrimination, exploitation, and separation from their families, they also create opportunities through remittances that can uplift their communities back home. This duality highlights how economic motivations for migration can lead to transformative outcomes for both migrants and their families, fostering resilience amidst global economic fluctuations.

Related terms

Remittances:

Funds that migrants send back to their home country, which can be crucial for supporting family members and stimulating local economies.

Labor Migration: The movement of people from one country or region to another for the purpose of employment, often driven by economic opportunities.

Transnationalism:

The process by which migrants establish and maintain multiple connections and relationships across national borders, often leading to social, political, and economic ties.