Professors of Economics Louis Putterman and David Weil have shown a correlation between current income inequalities among and within countries and the migration patterns of their populations hundreds of years ago.
The "World Migration Matrix," created by Putterman, Weil and a team of research assistants, tracks the population movements of 165 countries going as far back as the 1500s. After compiling data on population composition, ethnic origins and immigration history, the economists observed that analyzing migration patterns and the presence of various ethnic groups improves one's understanding of current income differences among countries.
Putterman said recognizing the presence of different ethnic groups within a country and their historical migrations turn out to be better predictors of that country's gross domestic product than simply using the traditional measures such as state policies, early transition to agriculture and early technological advancement.
In an e-mail to The Herald, Putterman wrote that when a growth determinant is adjusted for migration, the strength of the variable as an indicator of current per capita GDP increases.
"For example, Fijians whose ancestors came from the Indian subcontinent, with that area's history of literate, urbanized, densely populated civilization, have higher socio-economic status than ones of indigenous Fijian ancestry, on average," Putterman wrote.
"What matters is the history of the people who live in a country today, more than the history of the country itself," Putterman and Weil said in a statement.
The study indicates that if a population 500 years ago exhibited a high level of development, its descendants tend to be richer as well, Weil said.
Many studies on economic growth and development make ad hoc adjustments like assuming a country's population originate from one land, Weil said, adding that he and Putterman decided to "bite the bullet" and build a data set accounting for the various constituents of a country's population and their histories.
The essence of growth economics is to understand the degree to which a factor affects development, said Ishani Tewari GS, who worked on the project.
"The study helps identify factors you can and cannot change - how much is an outcome of the past and how much is determined by more proximate history," she said.
But Joshua Wilde GS, who modified the original matrix based on geographical distances to one studying migrations across linguistic distances, said that correlation did not necessarily mean causation.
"This study ... establishes a correlation between income levels and early development, and if there is something in the correlation that can be causal, then (economists) would be able to address issues of income inequality," Wilde said, adding that a potential causal relationship between migration patterns and current income levels needs to be researched further.
Weil also said the study is at an early stage. "I think we are very, very far from the stage of making policy on it. One way to see the matrix is as a lens for looking at the data," he said. "How does the early development of Malaysia 500 years ago predict how it is today?"
Though the matrix shows that certain ethnic groups have a historical advantage, the results do not imply that income levels will remain static forever. Putterman wrote that the most basic implication of the study is that long term forces have contributed to developmental inequalities around the world today.
"A larger implication ... is that these results show that human outlooks and capabilities, which is what I believe is being transmitted by the ethnic, linguistic and cultural groups that our data tracks, are more central to economic outcomes than practically any other factor, and that they can be very persistent," he wrote.
"Therefore," he added, "if one wants to attack problems of underdevelopment and poverty, finding ways to help poor countries and disadvantaged groups build outlooks and capabilities that are more promising of economic well-being should be a central focus."
