Why Do Migrants Go Back and Forth? Circular Migration Between Finland

Why do migrants go back and forth? A Review and Empirical Tests of Micro-related Theories Rosa Weber and Jan Saarela Rosa Weber Stockholm University, Sweden Department of Sociology Jan Saarela Åbo Akademi University, Finland Abstract Circular migration has received increasing attention among policy makers over the last two decades. However, to date we know relatively little about the mechanisms underlying circular migration, largely because of data constraints and lack of a unified theoretical approach. The aim of this paper is to synthesise the growing body of research under a common analytical framework and to investigate the hypotheses empirically using detailed linked Finnish and Swedish register data. This data set allows us to observe individuals in both countries and thus to follow migrants across national borders. We use an event history framework and find that migrants who move more than once or twice are very mobile. Similarly, we observe strong selection effects and seasonality in movement back and forth. With this, we hope to lay the ground for more thorough empirical investigation of circular migration. 1 1. Introduction Over recent decades, we have observed a vast increase in migration flows. Cross-country transportation has proliferated both in scope and speed. Last minute Ryanair and Eurostar tickets, among others, have made the decision to move ever easier. Simultaneously have numerous governments initiated programs promoting circular migration. In the European Union in particular, incentives to increase cross-border movement and temporary or circular migration have entailed the granting of the European citizenship allowing citizens to move freely between the EU-member states, as well as, incentivizes for targeted groups. Even though free movement laws in the EU have removed prior constraints to settling abroad, the level of geographical mobility of EU citizens remains lower than expected (Recchi 2005). Migrants from other EU member states make up 1.6% of the residents, compared to the 3.4% that immigrants from outside of the EU constitute, a large share of who come to EU-member states as refugees and asylum seekers (Eurostat 2004). However, it remains unclear whether intra-EU movement is only less ‘visible’ in current data sets than immigration from outside of the EU. Predominant forms of intra-EU movement are short-term, commuting and rotation mobility, which are more difficult to capture empirically than permanent migration (Benton and Petrovic 2013; Castro-Martin and Cortina 2015). Indeed, many data sets define migration as a movement after being resident in a country for one or five years (Recchi 2005; see also Deshingkar 2008 and Hugo 2008). Similarly, data sets that have information of temporary movements often rely on self-reported information regarding the time abroad (Nekby 2006; Bratsberg et al. 2007; Vadean and Piracha 2009). In this paper, we are able to overcome this problem by using unique linked Finnish and Swedish register data that allow us to follow migrants across national borders. We measure migration on a monthly basis and, moreover, have detailed information on background characteristics. Specifically, we analyse a sample of Finnish migrants who moves back and forth between Finland and Sweden between the years 1988 and 2005. Even though various theories have been proposed to explain circular migration, there is no single, coherent theory that allows us to analyse certain hypotheses. The main aim of this paper is, therefore, first to 2 compile different ideas that have been proposed into a number of empirically verifiable hypotheses and in a second step to test these empirically. With this, we hope to lay the ground for more thorough empirical investigation of circular migration. The paper is set up as follows: We begin by a discussion of the mechanisms underlying migration in order to facilitate the discussion on the decision to move back and forth. In the interest of space, we do not delve into return migration. Then, we provide a description of the data set, as well as, the Finnish-Swedish migration context. Finally, we provide an empirical investigation of the hypotheses and a detailed outline for future research in the field. 2. Why do people move and where do they go? Theoretical and empirical investigations of migration have been challenged by the complexity of factors at play in any decision to migrate. A migration can be a dream of self-realisation, a gesture of escape, an adventure, a rite of passage; it may be undertaken for love, excitement, experience, leisure or ‘seeing the world’ (King 2002). In an attempt to understand this wide array of reasons underlying migration, we take a holistic theoretical approach and focus on neo-classical economics, new economics of migration and social network theory. Much of the empirical migration research on the Mexico-US context leans on these theories and they are, moreover, well-apt to incorporate more recent literature on intra- EU migration. Four restrictions should be kept in mind. First, we predominantly discuss the micro-part of migration theories, sometimes considering also the meso-level. This choice is largely data driven, but allows us to investigate the mechanisms underlying individual decisions. Second, we adopt a broader position that causal processes relevant to migration may operate on multiple levels simultaneously, and that sorting out which of the explanations are useful is an empirical and not only a logical task. Hence, we first considered each model separately to derive empirically testable propositions and evaluate them empirically in a subsequent step. Third, our focus is directed by theories’ applicability to the European setting, as well as, movement between countries with similar GDP per capita. Forth, the theories discussed are all 3 rational choice theories. Rational choice theories have been subject to heavy criticism in some disciplines, but they provide us with a useful framework for an empirical assessment and, moreover, linking this to the existing literature. Neo-classical economics Neo-classical economics posits that migrants base their decision to move on a cost-benefit calculation, which leads them to expect a positive net return, usually monetary, from movement. Wage differentials are expected to be important factors in the decision to move. Indeed, according to the EIMSS work-related reasons are common determinants of migration (Recchi 2009, pp. 217). Moreover, according to neo-classical economics human capital characteristics that are more remunerated in the host than the home country increase the likelihood of international movement (Massey et al. 1993, pp. 435). In short, the benefit of moving increases if your skills are valued abroad. Transferability of human capital is still relatively low in the EU. Many migrants hence decide to move between countries that are culturally close, which facilitates the transfer of human capital. For example, migration between Germany and Austria is high because of language and institutional similarities (Recchi 2005, pp. 15). Other migrants move in order to accumulate human capital. A common example of this is student migration. Another group of migrants that has received attention in the EU migration literature consists of retirement and resort migrants. These migrants are driven by preferences in climate and life style (see Klinthäll 1999 and King 2002 for a more detailed discussion), as well as, by lower prices in the host country. British pensioners who move to Spain exhibit capital that is worth more in Spain than the UK. Indeed, neo-classical economics expects that the flow of workers from labor-abundant to labor-scarce countries is mirrored by a flow of investment capital from capital-rich to capital-poor countries (Massey et al. 1993, pp. 433). 4 New Economics of Migration According to New Economics of Migration, migration decisions are taken by larger units of related people – typically families or households. The decision to migrate is hypothesised to be taken collectively with a common interest in mind, rather than by isolated individual actors as theorists of neo-classical economics assume. These groups of people, moreover, do not only want to maximise expected income, but also to minimise risks and to loosen constraints associated with a variety of market failures (Stark and Bloom 1985). In the EU literature, family and love related reasons are common explanations for migration. In this way, it is clear that migrants do not make their decision as isolated individuals. A second tenant is that people move to improve their situation or income in relative rather than absolute terms. They compare themselves to actors in their reference group, as other households in the home country. Social capital theory Many scholars have questioned the explanatory power of the two above theories when analysing factors governing migration decisions (e.g., Massey and Espinosa 1997; Saarela and Scott 2015). They find stronger empirical support for social capital theory, which posits a direct connection between networks and the costs and benefits of migration.1 According to this theory, migrant networks increase the likelihood of international movement because they lower the costs and risks of movement and increase the expected net returns to migration. Network connections, furthermore, constitute a form of social capital that people can draw upon to gain access to foreign employment. More specifically, they are sets of interpersonal ties that connect migrants, former migrants and non-migrants in origin and destination areas through ties of kinship, friendship and share community origin. This theory helps us explain the role of the social context more broadly in the decision to migrate. Each act of migration, additionally, alters the social context within which subsequent migration decisions are made, typically in ways that make additional movement move likely. Recchi (2005, pp. 17) similarly 1 Variants but closely related theories and concepts are network theory, cumulative causation and the self- perpetuation of migration. 5 finds that intra-EU migrations do not change much with year to year variations in wage and unemployment differentials between countries.

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