Comments

Professor Baldacchino, Thank you again for your engagement. I'm also glad that you are brining Malta and other countries in this conversation. I fully agree with you that return migration is conditional, and not emotional, people calculate risk. They ask: is there stability, justice, meritocracy, security? Is there something solid to return to? Without those foundations, the hope that migrants will come back enriched remains just that, a hope. For every returnee, there are many who settle permanently, especially when their skills are absorbed elsewhere. Remittances also declines over time. This is where my concern increases. Encouraging people to “drink the world” is wise, but only if the home system is strong enough to receive them. Otherwise, small states risk going into abyss. When your most capable teachers, nurses, engineers, and administrators are welcomed with open arms in larger economies, the capacity loss is not easily replenished. I am also concerned that much of the global migration–remittance literature generalises across contexts without sufficiently engaging the small-states scholarship, including MIRAB and, of course, your own work. Scale fundamentally changes the equation. What is manageable for Bangladesh or the Philippines can be disastrous for Tonga or Fiji. As you very well know, the political economy of microstates, the role of external rents, bureaucratic fragility, social cohesion, these are central issues. On your suggestion of a study: I think it is an excellent idea. The parameters of return migration in small states deserve rigorous analysis, especially how governance quality, institutional trust, wages, and political stability shape return decisions. I would be very happy to help stimulate such a conversation, including with colleagues at UNRISD. Or with donors in Australia/NZ.

Dear Khuram, Thank your kind words. In South Asia, where populations are large and labour supply abundant, migration and remittances have played a very different role. They have reduced poverty, supported families, and stabilised economies under pressure. My argument is not that remittances are “bad” or that migration is a failure. It is that context matters, especially size, scale, and institutional capacity. What works in Pakistan, India, Bangladesh, or the Philippines does not automatically translate to small island states with tiny labour markets and fragile public systems. I am very grateful that you engaged with the piece in such an open way. These conversations are important precisely because they allow us to see the same phenomenon from different historical and demographic realities. Thank you again for reading it so carefully and for reflexion.

Dear Shailendra, thank you for your kind words. And thank you for bringing up the "resource curse" element into this conversion. I would like to add the MIRAB model and aid dimension. The MIRAB model (Migration, Remittances, Aid, Bureaucracy) already recognised that small states often rely on external rents (Watters & Bertram 1985). What may be changing today is how those rents interact. Aid has become more fragmented, more conditional, often channelled through non-state actors, and less focused on building stronger, durable state capacity. The bureaucracy that aid sustains can become donor-responsive rather than citizen-responsive. At the same time, remittances sustain households directly. So we risk an equilibrium where aid keeps institutions/government appearing functional, remittances keep families afloat, and neither flow generates sufficient political pressure for structural and governance reform. One stabilises the state on paper; the other stabilises society in practice. But stability is not transformation. That is why our countries are stuck and people tend to leave. This interaction between aid and remittances is rarely analysed together. Policy communities treat them separately, development cooperation on one side, labour mobility on the other, yet in small island contexts they operate simultaneously within the same political economy. I think there is real scope to explore this further. If remittances help families but are not development, and aid helps governments function but not necessarily reform, what happens when both flows coexist at high levels? Do they complement reform, or unintentionally delay it? This feels like an important next research conversation for the Pacific and beyond (I'm already thinking of doing a paper). Thank you for pushing the debate in that direction.

Dear Ryan. Thank you for pointing towards the VoxDev review paper, which is valuable. My reading shows that migration and remittances reduce poverty, improve schooling, and help households cope with shocks. I do not dispute that. But evidence-informed policymaking requires context, and that is where my reservation are with some of the conclusions drawn from global averages. Most of the strongest evidence comes from large countries like Bangladesh, Nepal, and the Philippines. In those contexts, labour markets are bigger, training systems are large, and institutions can absorb losses. In small island states like Fiji, Tonga, or Samoa, scale changes everything. Losing a few nurses or teachers is not marginal, it can destabilise an entire system. There is no mention of the scholarship of the small islands literature. I speak not only as an economist, but as a migrant and a remittance sender. I know what remittances mean for families. They pay school fees. They rebuild homes. They buy imported goods. They ease hardship. But I also know what I have seen. I have seen empty classrooms in remote Fiji. Health centres without permanent doctors. Government posts left vacant or filled in acting positions for years. Businesses desperate to hire locally but forced to import labour. Villages where the productive middle generation are reduced, leaving mostly the young and the elderly. Children encouraged to get just enough credentials to leave. These realities rarely show up in micro-level regression tables. Migration is not bad. Remittances are not bad. But when scale is small and institutions are fragile, the political and institutional effects matter as much as the household gains. That dimension is largely missing from mainstream migration research. And for small island states, it is the dimension that may matter most.

Thanks a lot Ben, and good to hear from you. I certainly didn't mean to suggest I was the first to pick up on this issue. As a result of your comment, I have added some links to earlier analyses. I wrote this article to provide an update. This is the first time there is actually evidence for a large population decline in FSM. The RMI basic income policy response is also interesting. Regards, Stephen

This is a long response but given the subject matter, it is warranted. A thought-provoking, even disturbing article by Dr. Naren Prasad that needs urgent attention. Remittances are fairly prominent in the regional agenda, but the reporting is largely based on media releases, so mostly one-sided, with a positive, PR focus. Dr. Prasad’s article reminds us of a well-established phenomenon known as the “resource curse.” One of its biggest victims was Nauru, which doesn’t have much to show for all its phosphate wealth except for a scarred and largely barren landscape. Besides overindulgence, copious waste and being ruthlessly exploited, Nauru did not invest its wealth for the future and all the money has long since evaporated. Royalties and remittances may not be the same thing, but there are some undeniable parallels that we is a region would be foolish to ignore. Taking lessons from the Nauru experience, are remittances another “curse” of abundance and consumption that some Pacific Island countries are at risk from? (Labour/skills like phosphate, is a (replenishable) resource, so perhaps falls in the ‘resource curse’ category in some respects at least). This is the key question in Dr. Prasad’s article on the Pacific’s increasing dependency on remittances, which are climbing across Fiji, Tonga, Samoa, Vanuatu, Kiribati, and Tuvalu. The remittances are worth tens of millions—in Fiji alone over US$1.2 billion, which is around 11 percent of the GDP. Some might put remittances in the category of a “nice problem”. But that is both simplistic and short-sighted. As Dr. Prasad points out, domestic capacity is thinning, just as remittances are growing: “fewer teachers in classrooms, fewer nurses in clinics, fewer skilled workers in key sectors, fewer young people imagining a future at home”. He makes what he describes as a simple point, but it is quite profound: “remittances help families, but they are not development”. He adds that global experience shows the danger. “In Manila, Kathmandu, Kingston or Suva, I have never seen a country build lasting prosperity on the earnings of its absent citizens”. According to Dr. Prasad, the key challenge in the Pacific remains the same: how do we build an economy strong enough to keep our people? But, he argues, that “a quiet resignation has set in”. Any such complacency should be worrying, if not alarming. Dr. Prasad has sounded the warning very clearly, and it is vital that regional leaders take it seriously and make it a priority. Remittances can be described as easy money, at least for the recipients, and if Dr. Prasad is to be believed, they could lulling us into a false sense of security and laziness. Just as there is no such thing as a free lunch, there is no such thing as free money, and the Nauru experience is a stark reminder that history might repeat itself if such lessons are ignored.

Thank you for your kind words on my 1993 paper: that was my second-ever paper in an international journal! The parameters of Return Migration deserve a proper study. Return Migration depends on confidence in homeland stability, security, justice as much as in opportunity. We can wax lyrical about the wonder of family ties, the 'sense of home', and 'back to one's roots'. But people are not just romantic: they are also transactional. Will the move back be worth it? Is the risk justified? What is there to go back to? Sure: there may be obligations to care for elderly parent/s; help in a family business; but even these are usually framed in wider considerations. So, briefly: it is smart to 'send people away', sendback remittances, but also hoping that they eventually come back, enriching the domestic labour pool with talent and innovation. The latter is not a foregone conclusion. Indeed, for every sender of remittances, there is a missed opportunity of a returning migrant. Can UNRISD pilot such a study?

Thank you so much, Naren. That was a wonderful piece of writing. You have presented an entirely different perspective on workers’ migration and remittance inflows. Until now, I had viewed remittances only from one angle—their contribution to nation-building. Naturally, my thinking was shaped by the subcontinent’s context, where rapid population growth has created an abundant workforce. Migration and remittances have long been areas of interest for me, but your analysis has encouraged me to reflect on them from a new and broader perspective. Once again, thank you for sharing such insightful thoughts.

With respect, the simple point here is not correct and far too strong. This is a comprehensive recent review of rigorous studies and paints a rather different picture, if we are trying to draw lessons from the global experience https://voxdev.org/voxdevlit/international-migration/how-migration-reshapes-origin-areas

Thank you very much for your comment Charlton. I'm sure South Africa knows this tension well. Remittances across the region help households survive in Zimbabwe, Mozambique, Lesotho, Malawi among others, but they cannot replace functioning institutions, trusted governance, and domestic job creation. Financial inflows can stabilise families; only strong systems can sustain nations. You capture the core issue perfectly: development is about incentives. If talent is rewarded, institutions are fair, and opportunity is visible, people stay, or return. If not, migration becomes the rational choice. The challenge for policymakers, in Africa as in the Pacific and the Caribbean, is to resist the comfort of short-term relief and focus on long-term capacity.

Professor Baldacchino, thank you for comment. I have long admired your work on small states, and I still consider your 1993 piece, “Bursting the Bubble: The Pseudo-Development Strategies of Microstates”, one of the sharpest analyses of the vulnerabilities of microstates. It shaped much of my own early thinking. I agree entirely that “staying” is not development. Small states benefit enormously when their citizens “drink the world”, build networks, acquire skills and return with ideas, capital and confidence. Circulation, when it works, is powerful. My concern is about conditions. Encouraging outward mobility only works as a strategy if there are credible pathways to return, competitive domestic opportunities, and institutions & governance strong enough to retain talent. Return migration depends on confidence, confidence in governance, democratic stability, meritocracy, security and institutional fairness. If corruption grows, if appointments are politicised, if justice feels uneven, if insecurity increases, mobility becomes exit rather than circulation. This is precisely what is happening in my side of the world. And even worse, when the best and brightest (doctors, nurses, engineers, teachers, technical specialists) are welcomed with open arms abroad, the domestic system collapses. We end up training professionals who are quickly absorbed by larger economies, while our own bureaucracies struggle to retain high-level expertise. We then import labour from other developing countries to fill the gaps. This is the problem I see when our leaders celebrate remittance as development.

Agreed, Martyn. When Westerners refer to “the Pacific,” they’re usually thinking of Fiji and other Polynesian countries.