MACROECONOMIC DETERMINANTS OF INTERNATIONAL MIGRATION FROM PAKISTAN

Income inequalities and poverty are the main causes of international migration. The Pakistani workers were found in several countries of the world. Nearly half a million economic workers are working overseas, mostly in Middle Eastern countries because of oil boom. The outflow of workers varied in the year 1973 through 2005. The fluctuation behavior of international migration in Pakistan was mainly attributed to the economic conditions of home as well as the host countries. Pakistan is over populous country mired with unemployment, abject poverty and inflation. The unemployment rate in the country is nearly 9 percent, nearly one third of the population lives below poverty line which is further exacerbated with 10-12 percent food inflation. In the early 1970s, lots of unskilled workers left the country to Middle Eastern countries. There is hardly any study which documented the determinants of migration in Pakistan. This paper investigated the determinants of international migration in Pakistan. The time series data were analyzed to identify the determinants of migration. The stationary properties of each time series used in the study were tested and each was found to be integrated of order one. Therefore, Cointegration and vector error correction models were used to establish the long run and short run relationship among the parameters of the determinants. The analysis revealed that the migration from Pakistan was found positively related with inflation and unemployment rate in the country and was negatively related with real wage rate. Thus inflation, unemployment and declining wage rate were the push factors for international migration from Pakistan. Moreover, the findings of the research paper showed that the international migration was also influenced by the inflow of the remittances positively. The size and amount of remittances was mainly dependent upon the economic conditions of the host country. Therefore, the inflow of remittances was safely considered as the pull factor of international migration from the country. Based on research results, it seems important to introduce labour friendly migration policies and the Manpower Ministry should find niche markets for potential workers. The government should also consider providing different skills and trades to compete with workers of other countries. This will further augment the flow of remittance in the country.