C) Migration: o within economies o between economies

The idea

Migration involves the movement of workers seeking better employment. Migration within economies (internal migration) often occurs from rural to urban areas, such as workers moving to London for higher-paying jobs. This helps alleviate regional skill shortages but can cause housing congestion in cities and a brain drain in rural areas. Migration between economies (international migration) involves workers crossing borders, such as nurses moving from the Philippines to the UK. This increases the host country's labour supply, potentially depressing wages in low-skilled sectors but boosting overall productivity and filling critical skill gaps. Both forms of migration are vital for labour market flexibility and responding to macroeconomic shifts.

What earns the marks

• Identify internal migration as the movement of labour between regions within the same country, often driven by regional wage differentials.
• Identify international migration as the movement of labour across national borders, influenced by relative macroeconomic performance and immigration policies.
• Explain how inward migration increases the size of the active labour supply, shifting the labour supply curve outwards.
• Analyse the impact of migration on wages, noting that an influx of labour may depress wages in specific sectors while filling critical skill shortages in others.
• Evaluate the external costs and benefits of migration, such as increased pressure on public services versus higher tax revenues.

Common mistakes and how to put them right

• Assuming migration only refers to international movement.

  Put it right: Recognise that migration also includes internal movement within an economy, such as rural-to-urban migration.

• Stating that inward migration always causes widespread unemployment among native workers.

  Put it right: Explain that migrants also consume goods and services, creating new jobs and shifting labour demand outwards.

• Ignoring the impact of emigration (outward migration).

  Put it right: Consider the effects of a 'brain drain' on the source country or region, which can suffer from reduced productive capacity.

Exam tips

• When analysing migration, distinguish clearly between the short-term impacts on local wages and the long-term impacts on aggregate supply and economic growth.
• Use supply and demand diagrams for the labour market to illustrate how net inward migration shifts the labour supply curve to the right.
• Consider the demographic characteristics of migrants, as they are often of working age and can help offset the economic challenges of an ageing population.