On Migration Policy: let them learn and let them earn

On migration policy: Let them learn and let them earn

Four bits of information on migration to Europe and Germany in particular called my attention last week: An article in the latest issue of the economist (“Let them in and let them learn”, August 29th-September 4th 2015); a news header in the Frankfurter Allgemeine Zeitung (FAZ), a German Newspaper; an interview with the head of the German national office for migration broadcasted at Deutschlandfunk, the German equivalent to the BBC, and a phone call with a relative in Potsdam, a mid-sized city nearby Berlin (most famous for Park Sanssouci, the German Versailles, and the Potsdam Conference in 1945).

The FAZ-newspaper article first: The secretary of education in the German state of Thueringen intends to stop letting children of refugees families to go school. So far, there is compulsory school attendance for every infant aged 7+ on German soil. This is a bad idea. To leave the most vulnerable in society behind, is foolish for their personal well-being, but also for an aging education based society.

This is also the reason why, as “The economist” points out in the aforementioned article, a “bigger welcome mat would be in Europe’s own interest”. The United States have benefited from the continuous inflow of migrants, both skilled (Silicon Valley) and unskilled ones (farming and service sector). Seemingly there are potential payoffs for Germany, as well, but this prospect subject to some condition. The first one: Migration policy in Germany needs a migration law. There is none in Germany, yet. Setting standards is helpful in any case. The second condition: The procedure for granting the right of asylum in German has to be (i) more firm and (ii) more rapidly. As the Economist puts it, “Syria is a hellhole; Albania is not”. To say no has to be potential outcome of the procedure for granting asylum. The procedure has to be more rapid, both for the sake of the refugees and German taxpayers. In Germany it takes 5 months to arrive at a conclusion in an asylum seeking procedure, on average. In Switzerland and Norway the number is 48 hours. German decision makers should book their tickets to Oslo, or more cheap, to Bern, and identify the reasons for performance gaps. Performance Benchmarking is a good idea.

The third condition: Refugees have to become integrated in real terms. Clustering them in refugee camps first and later in suburban boroughs is another foolish policy. The city of Potsdam seeks out a better way of doing things, as my phone call informed me. As new refugee arrives, he and his family will be accommodated in an apartment in state-owned housing blocks which are common in Eastern Germany and lack any notion of run-down second class accommodation. Regular German people live next door. And the other next door. This is quite different from stuffing a dozen of families into a former casern. And the refugee’s children will have their first day at school on next Monday, as kids from the other regular peoples’ family will do. Integration triumphs over clustering and its unintended negative side-effects. Best-practice.

So let them earn, let them learn and take a decentralized approach to accommodation.


Definition and Scale of the Public Sector

In a recent lecture I told my students that ‚the public sector‘ encompasses anything that fits into Norman Flynn’s definition as  „those parts of the economy that are in state ownership, or under contract to the state, plus those parts that are regulated and/or subsidized in the public interest.“ (Norman Flynn, 2007. Public Sector Management. London: SAGE, p. 2). 

And this is quite a lot in most countries.

General government expenditures accounted for some 45 per cent of GDP on OECD-31-average in 2011 (still impacted from economy-boosting measures after the crisis), up from 42  per cent in 2001, according to the latest data in the 2013 OECD Government at a glance volume. Denmark and Sweden are and have always been a big spenders (57.6 and 51.2 per cent, respectively). The UK are slightly above OECD-31 average, but remember this is 2011 data, for the moment local governments in England are facing sever budget cuts, in particular. In Russia general government expenditures as a percentage of GDP are at some 38 per cent, down from 42.3 % in 2001. The scale of the public sector in China grew from roughly 18 % of GDP  in 2001 up to roughly 24 % of GDP in 2011.

For me public sector research further includes all the managerial and political processes that keep this machine running. It is important to include issues of public management and public administration (this is the administrative and organizational science perspective), the politics of decision making (the political science perspective, ‚Will the Tory City Mayor eventually provide us with a new kindergarten within walking distance‘), and decision making theories in general, so that behavioral economics, psychology and sociology come into play (Why do decision makers take the actions they take?). Institutional and public economics have been major contributions to our understanding of ‚the public sector‘ as well.

That is also quite a lot stuff.

The main functions of government can be seen from the COFOG-classification of the OECD (OECD (2013), “Classification of the Functions of Government (COFOG)”, in Government at a Glance 2013, OECD Publishing.http://dx.doi.org/10.1787/gov_glance-2013-58-en). There a 10 1st level main functions:

General public services
Public order and safety (see below)
Economic affairs
Environment protection
Recreation, culture and religion
Social protection (see below)

and additional 2nd level sub-items; 81 functions in total.

030 Public order and safety
0301 Police service
0302 Fire protection services
0303 Law courts
0304 Prisons
0305 RandD Public Order
0306 Public Order n.e.c

Table: 2nd level Cofog classification Public order & safety

100 Social Security
1001 Sickness and disability
1002 Old age
1003 Survivors
1004 Family and Children
1005 Unemployment
1006 Housing
1007 Social exclusion
1008 RandD Social protection
1009 Social protection n.e.c

Table: 2nd level Cofog classification social security


To further structure this, it is helpful to have a look at who provides what, i.e. which level of government accounts for what kind and chunk of public spending. I am especially interested in the relevance of local authorities for public service delivery. For instance central government accounted for 99.8 per cent of total government defense expenditures in 2011. (no surprise). For housing the central:local ratio was 73.0 :  27.0 in 2011. (There are no states as in Germany, so data are absent „-„)

Function/Sector       Central  |  State   | Local | Social security
General services       86.5 — 13.5 —
Defence                      99.8 — 0.2 —
Public order              57.5 — 42.5 —
Economic affairs      69.5 — 30.5 —
Environment            42.7 — 23.3 —
Housing                     73.0 — 27.0
Health                        100.0 — 0.0 —
Recreation, culture  55.4 — 44.6 —
Education                  55.6 — 44.4 —
Social protection      79.7 — 20.3 —

United Kingdom: Expenditures by function (COFOG) and level of government/sector, as a percentage of total government expenditure, figures for 2011; Data Source: OECD 2013.


References and further readings:

OECD (2013), “Classification of the Functions of Government (COFOG)”, in Government at a Glance 2013, OECD Publishing.http://dx.doi.org/10.1787/gov_glance-2013-58-en

Flynn, N. (2007). Public Sector Management. London: SAGE.

Public Service Delivery

The street washer

My first-hand experience with public service delivery in Moscow started when I headed to my first round of job talks at Vyshka (the regional dialect for HSE) in early 2014.

I took a citizens perspective. I recognized that a large truck with a high pressure spray nozzle was approaching from behind. It turned out later on that this is a common scheme to clean the streets from dust in the summer and from mud in springtime. The sideeffect – which I anticipated much quicker – however, is that a significant chunk of this melange of dust and dirt splashes onto the sidewalk. It is clear to the reader what followed. At least I was able to prevent the worst, good, because I only had one suit with me in Moscow. I was not the only one suffering, other locals shared my situation; a fact that put my mind at ease, because it was not the foolish mistake of an excited foreign who does not watch his steps.
Since then I keep respectful distance from what I call the nozzle machines. It is a common scheme in Moscow. In early May they first spray a first truck sprays special shampoo, a second trucks spray water. This is called general cleaning. In more narrow street, e.g. in backyards and sidestreets, the job is done by small scale tractors.

I a 70ies book from Richard Scarry on „Cars and Trucks and things that go“ (or so), one of my sons favorites books, I recognized a similar nozzle machine. It is called the street washer (not pictured, due to potential copyrights violations). So it seems to be not a Russian thing.

The job talks were succesful, by the way.