Institutions and good governance as a factor of migration in Europe

Abstract

The research objective is to determine the relative importance of two groups of factors that influence the net migration rate: economic, such as the gross average monthly wages, and non-economic, which include the efficiency of institutional arrangements based primarily on corruption control and the rule of law indicators. According to the neoclassical theory of migration, economic factors have a dominant influence on the migration decision-making process. On the other hand, the institutional theory of migration advocates the position that institutional and managerial factors prevail over economic ones. The assumption on which the research is based is that migration is caused to a greater extent by the quality of institutions and good governance indicators, than by the opportunities to achieve a better material position represented by a higher average salary. On a sample of 48 European countries, for the period 1996 - 2021, it was investigated which group of factors dominantly determines the net migration rate. The sample of 48 countries is divided into two sub-samples so that one of them contains countries with a higher level of income and the strong anti-corruption and rule of law standards (28 European Union countries) and the remaining 20 non-European Union members with lower gross average monthly wages, weak institutions, as well as less favorable indicators of the rule of law and control of corruption. Using the techniques of econometric analysis of panel data, predictors of the net migration rate in European countries were identified. The analysis confirmed that the quality of the institutional framework is extremely important and that the rule of law and corruption control had a stronger impact on the net migration in European countries than the gross wages. This is supported by the evaluated parameters to the corresponding explanatory variables in the models. The research also confirmed that institutional factors had a stronger impact on the net migration rate in less developed European countries that are not members of the European Union than in the 28 European Union countries. Corruption is an important problem in many countries and citizens are very sensitive to this aspect of institutional quality. The findings of this research show that less developed European countries must pay special attention to building institutions, the rule of law and control of corruption if they want to stop negative trends in net migration, and that these factors prevail over the economic factors that were dominant in the 20th century.