Migration is economic development. I expect migrants to do better economically than homebodies. Why do the geographically mobile earn more than the stuck? A clever way to answer that question: Compare two geographically mobile groups. Upward mobility for Bangladeshis and Pakistanis in Britain:
Both Bangladeshis and Pakistanis have low employment rates because so many women do not work. But among the young, Bangladeshis are more likely to be studying or in work. And Yaojun Li, a sociologist at the University of Manchester, calculates that Bangladeshis’ average monthly household income, though still low, is now slightly higher than that of Pakistanis.
Bangladeshis born in Britain are also more likely than their Pakistani counterparts to socialise with people of a different ethnicity, according to another study (see chart 2). Both still overwhelmingly wed within their own ethnic group. But among young men, for whom marrying out is easier, 26% of Bangladeshis now do so compared with 17% of Pakistani youths.
Bangladeshis outperform Pakistanis. The data on "marrying out" comes off as an effect, not a cause. The suggested leg-up for the Bangladeshis is two-fold. First, Bangladeshis came later and avoided occupations in the dying textile industry. Second, Pakistanis concentrated in the part of Britain known for textile employment. Thus, Bangladeshis concentrate in London; Pakistanis do not. Geography is destiny.
I've been messing around with social science for about 25 years. I put people before place. Geography is not destiny. Geography is the symptom, not the disease.
Pakistanis as relative under-performers remind me of the Portuguese community in Toronto, Canada. Many migrants crossed an ocean and stubbornly refused to interact with other ethnic groups. The Toronto neighborhood might as well be in Portugal. The refusal to socialize outside one's immigrant group, I argue, causes the negative economic outcome.
What's so great about cavorting with the other? Migration in and of itself isn't necessarily a boon to the migrant. See the Portuguese enclave in Toronto or the Pakistanis in Bradford, United Kingdom. Migration is how many people overcome the economic barriers of geography. In the U.K., moving from Bradford to London would seem a lot less daunting than the initial move across international borders from Pakistan. I suspect Bradford Pakistanis don't move to London, where they might benefit as Bangladeshis have, because they don't socialize with people of a different ethnicity.
Two examples for migrant networks with different degrees of integration are illustrated in Figure 1. The figure on the left describes an ethnic enclave. Its members, represented by the circles, have close connections within the network strong ties, but very few connections to the outside world, represented by the crosses. An enclave is a typical example for a network with a high degree of closedness. This is a pervasive pattern in social networks, to which the literature often refers as inbreeding homophily the fact that individuals with similar characteristics form close ties among each other (McPherson et al., 2001; Currarini et al., 2009). Examples for such closed-up migrant networks are Mexican neighbourhoods in Los Angeles or Chinatowns in most North American cities.
The graph on the right represents a well-integrated network, whose members have weak connections among each other but strong connections to the outside world. Examples for such groups are the Germans in London or the Dutch in New York.
There are two reasons why a potential migrant receives better information from a well integrated network than from an enclave. First, the well-integrated network has more connections to the outside world. Its members receive more information and therefore have better knowledge about job perspectives in the receiving country. In contrast to this, members of an enclave typically have little knowledge of the language of the host country (Lazear, 1999; Bauer et al., 2005; Beckhusen et al., 2012). An enclave may offer job opportunities within the migrant community, but it has very limited information on the labor market outside the enclave.
"Marrying out" or interacting with people not like you improves labor market intelligence and will land you a better job. That's true for two people competing for employment in the same geography. The one who is at ease with less social capital wins. Mingle or be poor.