The Rise and Fall of Nations: Forces of Change in the Post-Crisis World

by Ruchir Sharma

Migrant laborers—mainly fellow Buddhists from Myanmar, Laos, and Cambodia—also move easily in and out of Thailand, but they come as they cho...

Among the large emerging nations, the big recent gainers from migration have been Turkey, Malaysia, and South Africa, all of which have become regional magnets for refugees and job seekers.

Between 2011 and 2015 inbound migration increased the population of South Africa by 1.1 percent, of Malaysia by 1.5 percent, and of Turkey by a striking 2.5 percent.

In 2014, even as right-wing parties across western Europe were screaming for the expulsion of immigrants and refugees, Turkey quietly extended legal status to more than one million refugees, many of them from Syria. At least some Turkish leaders recognized the opportunity to import labor muscle and talent, including the many doctors and other well-educated professionals in the refugee ranks. In 2014, according to World Bank president Jim Yong Kim, a quarter of the new busi...

In recent years Silicon Valley tycoons have become increasingly concerned that the United States was closing its doors to highly skilled foreigners, putting the country at a disadvantage in the talent wars.

Since 2000 the United States has let in more and more foreigners to study but not to work. The number of student visas rose to nearly half a million over that period, but the number of employment or H1B visas held steady at around 150,000.

The United States was sending 350,000 graduates home each year, mostly to India and China, and competitors were circling Ca...

In 2013 the tech analyst Mary Meeker circulated photos of a billboard that the Canadian government placed on Highway 101, the main artery through Silicon Valley, taking a cheeky jab at President Barack Obama’s promise of a foreign policy “Pivot to Asia.” The billboard read, “H1B problems? Pivot to Canada.” Before a visit to the Bay Area in the summer of 2013, Canada’s minister of citizenship, immigration, and multiculturalism, Jason Kenney, said he ...

There is no question that cultural barriers complicate the process of integrating migrants into an advanced economy, but the same is true of integrating women and the elderly.

Moreover, the fear of unskilled migrants is probably overblown. A growing body of research shows that immigration—skilled or not—tends to boost productivity and economic growth.

In general Ozden found that migrants often take jobs that locals don’t want or can’t fill. On a visit to Greece in June 2015, when its debt crisis was still raging and concern was high over double-digit youth unemployment, I was struck by how many local business owners nonetheless complained about the work ethic of young Greeks, saying they prefer to live at home on the generous pensions of their mothers, who shield them from grunt jobs.

Ozden also found that unskilled migrants tend either to have no impact on local wages and employment or to increase wages and employment. He draws a parallel with the case of Malaysia, where the large recent influx of foreigners allowed many high-school-educated locals to become junior managers of immigrant laborers rather than be laborers themselves. This resulted in a big boost to economic growth, and the boost from skilled migrants tends to be even larger.

The main human drivers of productivity growth in the United States are scientists, tech professionals, engineers, and mathematicians—fields in which immigrants are already overrepresented. In this way migrants tend to fill jobs locals don’t want at both the low end and the high end, whether as maids or math professors.

Skilled migrants also spur technological progress by carrying across borders the sort of information that is hard to write down, because they are learned and disseminated through hands-on experience, like the details of making semiconductors. According to Harvard University’s Atlas of Economic Complexity, the key to driving economic growth is not so much individual experts as the combination of expertise required to make complex products: for example, the mix of experience in batteries, liquid crystals, semiconductors, sof...

For many emerging nations, the battle is as much about retaining as attracting talent. In the 2000s, by one estimate, some ninety thousand inventors moved out of China and India, many of them to the United States. That represented potentially dramatic gains for the United Sates and substantial losses for the emerging giants, but there is no systematic way to track these trends. I simply keep my ear to the ground for current evidence of brain drain and its reverse.

The Chinese economy was much farther from a crisis situation than Russia’s, but my colleagues there reported similar chatter. More than ninety thousand millionaires left China between 2000 and 2014—by far the largest outflow in raw numbers for any country.

A Barclays Bank survey in 2014 of two thousand wealthy Asians found that the Chinese were by far the most likely to be considering emigration, with 47 percent of them saying they aimed to leave their home country within five years.

Among the Chinese aiming to emigrate, roughly three out of four cited economic security, a better climate, and better job and school oppo...

Chinese dinner table conversations were all about the best place to go: the United Stat...

Recent news reports said that tens of thousands of Chinese were looking to invest in Australia and Canada in order to secure special visas that allow large i...

When smart people are seeking to move out of a country it is a bad sign, and when they are looking to move out along with the...

Workplaces evolve to incorporate machines, but people find a way to fit in. Though U.S. banks have replaced a lot of humans with automated tellers, the savings have allowed them to open up a lot more branches, so that in total the number of human tellers actually increased from 500,000 in 1980 to 550,000 in 2010.

I am optimistic on automation in the workplace because I believe that the laws that govern the economic world are similar to those that govern the physical world, in which nothing is ever lost, nothing is gained, and everything is transformed. Over the past twenty-five years, as McKinsey consulting has pointed out, about a third of the new jobs created in the United States were types that did not exist, or barely existed, twenty-five years ago. In the next transformation of the workplace, humans are likely to replace the jobs lost to robots and artificial intelligence with new jobs we can’t yet imagine.

As the economic impact of population decline unfolds, some analysts will argue that the smart response to slower population growth is no response.

That was the contention of many people in Japan, where the rapid aging of the population was visible as early as the 1960s, when the birthrate first fell below the replacement rate. The do-nothing argument is that the economic impact of population decline doesn’t matter, if it doesn’t lower per capita incomes. But it is hard for any country to hold that above-it-all pose. The reality of global competition will always intrude. In 2010 China became the world’s second-largest economy, passing Japan, which has since mobilized much more a...

A growing population matters for global status and the power that comes with economic might, apart from the greater dynamism and higher productivity that res...

To assess which nations are best or worst positioned to grow, look first at projections for growth or shrinkage in the working-age population, to gauge the potential baseline gain for future economic growth. Just as important, track which countries are doing the most or the least to leverage whatever population gains they will enjoy. Are they opening the workforce to the elderly, to women, to foreigners? Are they taking steps to increase the talent level of the workforce, particularly by attr...