Saturday, April 15, 2017

Follow the immigrants

This, which I have sent to the editor, builds on a previous blog-post

“Follow the immigrants.” 

That is an easy guideline to understanding the economic geography dynamics in the contemporary United States.

Consider the affluent neighbor that is immediately south of us. The prosperity in California correlates well with the percentage of foreign-born to whom the Golden State is now home. More than a quarter—about 27 percent—of its population was born outside the country. It is no wonder that the Silicon Valley looks more and more like the United Nations.

Consider a contrast to California. West Virginia is an economic laggard, where how one talks about coal—not silicon—is the way elections are won and lost. Here, too, there is a correlation between the economy and the percentage of foreign-born. Barely 1.4 percent of the population in West Virginia was born outside the US. To put it simply, immigrants do not flock to West Virginia.

It is more than a mere correlation, of course. The foreign-born population cannot afford to be jobless and poor, whether they are here legally or illegally, and whether or not they are skilled or unskilled. Hence, immigrants are almost always headed to states where there is potential for work and wages. California offers that promise, and not West Virginia.

In this broad framework, Abigail Cooke, an assistant professor of geography at the University at Buffalo, and Thomas Kemeny, a UB research assistant professor and at the University of Southampton in England, write about their research that was recently published in the journal “Economic Geography.” There is "a strong relationship between greater immigrant diversity and higher productivity—in this case, wages.”

Jobs and incomes are urban-based. "What we found was remarkable. In cities that are unwelcoming to immigrants, as diversity rises, people's wages either don't change, or they go up by only a small amount. In cities that are welcoming to immigrants, as diversity goes up, people's wages go up, and by a lot,” Cooke notes.

It is an interesting feedback cycle. Cities and states where the economies are growing attract immigrants. This influx strengthens the human capital that in turn creates more economic growth and development.

Such dynamics are not merely a contrast between California and West Virginia. In Oregon, the foreign-born account for about 9.8 percent of the population. Even within the state, we can observe differences between, for example, the metropolitan Portland where the economy is based on modern economic activities, versus Coos Bay whose economy was based on natural resources. 

An economy based on resources that were prized in the past—like timber—lags behind one that is driven by the likes of Intel and Nike. This means we will also notice a corresponding significant difference in the percentage of the foreign-born in the Portland area versus in coastal communities.  A diverse immigrant population is naturally attracted to regions for obvious economic reasons--even farming grains, fruits, and flowers, with considerable export potential, will attract immigrants.

However, this unequal economic growth and development across the geography of the country, and within the regions of a state, have had serious implications. 

Richard Florida—an academic and a public intellectual based in Toronto, who has always been enthusiastic about cities, is now worried about a new urban crisis.  Florida writes in a recent essay about the winner-take-all-urbanism “in which the talented and the advantaged cluster and colonize a small, select group of superstar cities, leaving everybody and everywhere else behind. Much more than a crisis of cities, the New Urban Crisis is the central crisis of our time.”

The story is deceptively simple, but a complex one. Modern economic activities are urban-based, and immigrants flock to those urban areas with the greatest economic potential. The reinforcing feedback cycle makes some cities and regions more prosperous than others, and soon we have regions that are seemingly left behind. These left-behind regions, like West Virginia, are also home to less-diverse population.

It has also been clear for a long time that economic advancement does not seem to reach the corners of West Virginia or a Coos Bay here in Oregon. We the people need to try to understand such complexities in a rapidly evolving global economic geography. And, more importantly, we will need political leaders who can articulate constructive policy responses that will not dampen the pace of economic development even while assisting the under-performing regions. 

Or, we can simplistically decide, for instance, that immigrants in a heterogeneous California are the reasons for the lack of economic opportunities in a significantly homogeneous West Virginia.

I would rather that we attracted the immigrants, instead of chasing them away.


Ramesh said...

You covered this theme in an earlier post. You have written a very scholarly and elegant version for the paper.

I would be interested to see what sort of comments come. Forget the trolls; there may be a few serious comments debating the issues. When it comes out, drop me a line with the link.

Sriram Khé said...

Thanks for the mighty compliments, my friend.

Yes, if published, I will send you the link. I am sure the trolls will be the first ones to comment there ;)

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