prepaid by relatives and friends, publicity literature, and special facilities by steamship and railway companies.

FINANCIAL FEATURE OF MIGRATIONS

But in the study of this complex economic problem, which in the past has been directed mainly toward questions of standard of living and of the industrial development of the State, a highly significant aspect has been overlooked by most authorities on the population problem. I refer to the strictly financial feature.

Why not make a reckoning of the money transfers which result from human migrations? The importance of the phenomena is self-evident. What is the best method of approach? In the following brief treatment of the subject the writer gives certain of his preliminary findings with special reference to international movements of human capital and of capital goods.

ANALYSIS ON A TIME BASIS

On a strict time basis, an analysis might be attempted in accordance with (a) the period commencing with the emigrant's preparations for departure and extending until his arrival at destination, (b) the period away from his native land, and (c) the period (true only of temporary emigrants) beginning with the preparations for return to the mother country and extending until his arrival there. Period (b) is the most important time for observation. Periods (a) and (c), concerned with international migrations of people and their personal effects, cause expenditures for transportation and supplementary items. In an attempt to produce facts, moreover, it seems to me confusing to make the distinctions between "expenditures of immigrants and tourists" and "remittances to friends," since we know that funds are transmitted in countless ways and at no definite time periods.

My financial elements are based on (a) the personal value of the immigrant, (b) the goods or money he causes to be transferred to the foreign country, (c) the goods or money he causes to be transferred to his native land, other than "remittances," (d) remittances to his native land, and (e) the personal value of the returning emigrant.

FINANCIAL WORTH OF OUTGOING EUROPEAN EMIGRANT

What is the financial worth of the immigrant (outgoing emigrant)? Despite the mathematical calculations of Cantillon, Engel, Farr, Becker, Kapp, and others, this query admits of no definite answer. A figure commonly cited has been £200, approximately $1,000; but this amount was derived from conditions prevailing decades ago, when real prices were much less than they are now.

The usual basis of this computation was the average cost of bringing up an average person under average conditions until the average time of departure for another country. Obviously, the employment of the mythical average took scant account of sex, literacy, material condition, occupation, new environment, etc. As a hit-or-miss proposition, the "cost of production' adherents were bold advocates when they asserted that the economic value of an individual was in proportion to the public and private expenditures incurred in his behalf. But this proposal not only assumed a static money value regardless of whether the individual resided in Manchester, Monte Carlo, or Singapore, but also failed to recognize the inexorable laws of human demand and human supply. The utilitarians stood on firmer ground.

MONEY VALUE OF INDIVIDUAL

There is one method of placing a money value upon an individual which possesses real merit. Referred to by Prof. Mayo Smith as "scientifically correct

and

* * * the only one to be employed if we are determined to express in

3 Adopted by Sir George Paish in his memorable report on The Trade Balance of the United States, Report National Monetary Commission, 1910.

This is neither a fantastic nor a purely commodity conception. It may be easily defended in its proper use. For instance, this method invariably is resorted to by the conspicuous alleged friends of the newcomer, namely, the antirestrictionists.

figures the value of this increase of our labor force," it consists of an application of the principle of a life annuity.

On the subject of "life property," the computations of Dr. William Farr made nearly three-quarters of a century ago are still followed as the best basis for reckoning. The two determinants are the value of the individual and the value of his services. Briefly, the method was to prepare detailed figures relative to agricultural workers at different ages by taking into account future earnings, cost of future maintenance, and excess of earnings over cost of maintenance, expressed in terms of 'present value" and of the "annuity equivalent" at different interest rates. In his notable work, Vital Statistics (1885), Doctor Farr accorded the male agricultural worker a net value of £150; by extending the calculation to the entire population of the United Kingdom, the standard declined to £110.

Applying this valuation, he took account of the adult male character of the emigration from the United Kingdom in the year 1876, and arrived at the conclusion that the value of the individual emigrant was £175 per head. Thus we

may consider the situation as that in which two emigrants were valued at as much as three persons remaining at home. Whether or not we are willing to admit the validity of these conclusions, neverthless in principle nothing more satisfactory has been presented than to take the reckoning of age and services in order to compute the economic value of the migrant.

Despite the inferior type of present-day immigration into American from southern and eastern Europe in contrast with the influx half a century past from northern Europe, the enhanced nominal and real wages of labor in America has been accelerated to such an extent that certainly no injustice is done to the "average" present-day immigrant by according a financial worth of at least £200 per capita. Doubtless £300 would be nearer the truth."

ARRIVED ON PREPAID TICKETS

Frequently the American immigrant arrives on a prepaid ticket. The Report of the Immigration Commission of New York State (1909), in referring to steamship ticket agents, stated that "from 60 to 80 per cent of the business done by these authorized agents in New York State consists of prepaid tickets, purchased in this country to be sent to the intending passenger on the other side. This is always an order; that is, something which must be exchanged for the real ticket, and in no case is it good for passage until such exchange has been made." Various estimates place the percentage anywhere from 10 to 60.7

Foreign emigration to the United States, therefore, has been made easier by assisted money contributions, while modern steamships have done away with the former hardships of prolonged travel. Doubtless the steamship tickets, largely paid for by savings in America, must have amounted to at least $40,000,000 annually when immigration was at its height. Considerable amounts (no figures available), usually in the form of money orders, are sent abroad for the purchase of tickets at the place of embarkation, paid for largely by immigrant remittances.

Prof. Mayo Smith, in his article on immigration (he excluded transients) in Palgrave's Dictionary of Political Economy, wrote that the direct gain to the -country of immigration is measured by (a) money or capital they bring in, and (b) the economic value of the immigrants themselves.

The second consideration has already been discussed. With reference to "money or capital" brought in, no reliable figures are possible, since an immigrant furnishes information only when money amounts to less than $50 per person;8 moreover, children and other dependents make no money showing.

Emigration and Immigration, 1890, p. 109.

Accruing expenses which fall upon the immigrant must be taken into account. The United States Department of Commerce and Labor, Bureau of Labor, Report No. 72, 1907, pp. 411-12, stated that "before the immigrant can realize any return from his labor in the form of American wages, he must incur the following expense or indebtedness, for even if one or all costs are prepaid for him by relative, friend, or other person, he eventually pays them all by deductions from his wages or otherwise: (1) Cost of preparation at his home in Europe for the journey, (2) cost of transportation from his home to the European seaport, (3) cost of emigrant head tax to his Government, (4) cost of immigrant head tax to the United States Government, (5) cost of steamship transportation European port to the United States, (6) cost of labor agency for securing employment at port of entry if used, (7) cost of transportation United States port of entry to place of employment, (8) cost of living from port of entry to place of destination." Many of the same items occur again if the stay is a temporary one.

7 Probably 40 per cent, is a conservative guess. Miss Frances Kellor, Immigration and the Future (1920), gives 60 per cent, of tickets as purchased with American wages.

After the World War, the amount brought by aliens dropped to an average of about $1 a person.

In the fiscal year ending June 30, 1920, 51.4 per cent of our (United States) immigrant aliens exhibited less than $50 each, compared with 44.6 per cent in 1919, and 82.7 per cent in 1910-1914.9

These percentages probably understate the real situation, since relatives friends, and padrones make advances in order to aid their admission both before and after the arrival of the new comers. The United States Immigration Commission found (1910) that the recent immigrants brought in only about one-third as much as their predecessors. 10 In this respect there is a wide variance between nationalities, and also between citizens of the same country, as is shown conspicuously by the amounts brought in by northern Italians and southern Italians respectively.

Money per capita shown on admission to the United States by European immigrants (including Syrian), fisca years 1995 to 1999, inclusire, by class of immigration

[Compiled from reports of the United States Commissioner General of Immigration]

There seems to be a fairly general agreement that, in the aggregate, the amount of money individually taken out of the country exceeds that brought in in person. This is certainly the case now, since the number of returning aliens is a much larger percentage of the total movement due to the barring of numerous immigrants from southern and eastern Europe under the terms of the per cent act of the year 1921.11

Moreover, as the returning aliens are generally those among the migrants who have amassed the greatest wealth, it would not be surprising if the cash personally taken from the United States exceeded by 100 per cent that brought in simultaneously-an observation which does not appear unreasonable when reference is made to Austrian total emigration figures. For, during the period 1903-1910, returning Austrian emigrants brought on their person a minimum of 2,000 kronen per capita, or a total of at least 80,000,000 kronen. This amounted to 32 per cent, of their yearly remittances.12 There is no evidence to show that alien immigrants leaving America in the last decade were less thrifty than the earlier Austrian emigrants, many of whom returned from temporary residence in America.

Sir George Paish set as the average amount carried out by American alien emigrants "not more than $200." This estimate, made nearly 15 years ago, seems too low in view of the personal appearance 13 and what we know of these returning emigrants.

• Annual Report of the Commissioner General of Immigration, 1920, p. 43.

10 The goods or money brought into a country amounts to a considerable sum, even though most of the recent American alien immigrants are of a low moneyed class. The Immigration Cominission has collected evidence which would seem to indicate a relation between illiteracy and money brought per capita. After analyzing earlier data for immigrants arriving at the port of New York during 1899, the conclusion is "that even among the illiterate races, the more illiterate bring the less money." An instructive table was reproduced in the Immigration Commission Report.

11 For particulars of this act, as well as national emigration movements in which America appears prominently, see Manchester Guardian Commercial, Reconstruction in Europe, section 10, Emigration, Nov. 16, 1922.

12 Grunzel, op. cit., pp. 118-119.

18 Why have no rough estimates been attempted for personal belongings other than money? Yet certainly they can not be neglected entirely. Consider, for example, the transfer of personal effects in the case of the homesteader. No reliance is placed upon the household and personal effects returns in the foreign commerce figures.

INVISIBLE INTERNATIONAL MONEY TRANSFERS

My study lead me to establish an average of $400 per capita, which would mean, based on prewar and present alien emigration movements respectively, that from $120,000,000 to $80,000,000 should be allowed for these special "invisible" international money transfers.

In magnitude, either amount is in excess of the normal American exports of cotton manufactures per annum.

In addition to the money carried on the person, either the immigrant or the the returning alien emigrant usually causes funds to be sent in other ways. The commissioner of immigration at New York stated in his report for the year, 1901, that

Instead of bringing money with them, it is becoming more and more common for immigrants to send it ahead through banking institutions; but no one has attempted to state the amount thus sent.

The writer has no estimates of any kind, although it is probably safe to guess that millions of dollars are involved for the debit account of the mother country and to the credit of America. When sums are transmitted in the opposite direction, they are included to a considerable extent among immigrant remittances, but we are wholly in the dark regarding emigrant remittances.

Among other money transfers are (a) the foreign currencies purchased in the United States by departing aliens, 14 and (b) letter transmission of money by ignorant foreigners suspicious of American banking institutions or desirous of causing no undue excitement occasioned by the sight of a registered letter.

The money set aside for American banking accounts, for investments in America and for loans to friends can not easily be estimated.

However, the two leading considerations relative to immigrant money transfers are total earnings and savings, and funds derived from these savings, sent abroad and known as remittances. Among the many estimates that have been made relative to the welfare of population in America, one of the most quoted is to the effect that foreigners can save one-quarter of their earnings when they are content to live largely according to their former standards. The northern Italian earns more than the southern Italian but frequently saves less. Depicting conditions a decade and a half ago, the immigration commission found that the income of a thousand southern Italian families living in the cities might average $390 per year per male member. Allowance should be made that the average for the southern Italians was the lowest in 22 nationalities under observation. This figure, far below the standards set by American minimum wage commissions, meant that, "living upon less than these incomes, a family may be assumed to be spending its human capital. Although human capital loss can never be measured, the toll which it takes is heavy. Still, in this article, savings concern us only in so far as they enter international accounts.

" 15

Remittances are utilized largely (a) to support members of the family and friends, (b) to enable compatriots to emigrate, (c), to purchase land or clear off mortgages, (d) to set aside funds for immediate investment or speculation or for future spendings. Prof. C. F. Bastable, discussing the transfer of industrial agents from one country to another, wrote that "the influx of foreign capital resembles an acceleration in the speed of saving, and we may reasonably hold that the final result will not be very different in either case. In this way the international movements of labor and capital become assimilated to the ordinary processes of economic life, and may be regarded as the same in their general effect.' "' 16

Unquestionably, remittances from foreign-born in America to relatives and friends constitute an enormous sum. In the long run they are the largest "invisible imports" on the American international balance-sheet. For the years

1919-1921 inclusive, immigrant remittances and relief aggregated $1,800,000,000. Omitting the extraordinary $2,375,000,000 due in 1919 on net international Government payments account, the combined items of immigrant remittances and relief (the former much larger) had a clear margin for the three-year period, exceeding investment abroad, tourist expenditures, freights, net imports of gold or any other account on the debit side. International financiers have taken scant notice of the fact that the American balance of trade in 1921, amounting

14 C. F. Speare, North American Review, November 1907, estimated that for this purpose alone, foreign bankers in America annually imported foreign currency equivalent to $10,000,000 in kronen for Hungarians, and a similar amount in lire for returning Italians.

18 R. F. Foerster, The Italian Emigration of our Times, 1919, ch. xx,

16 The Theory of International Trade, 1897, p. 158.

to $636,000,000, was offset largely by the immigrant remittances alone.17 At best our source data are weak. Professor Mayo Smith reported faithfully that the exact amount of remittances from American immigrants had never been discovered.18 Mr. Speare and the immigrantion commission make no claim for completeness or accuracy. Sir George Paish reported that "neither the banks nor the express companies are willing to furnish the necessary information to enable an estimate to be made of the situation at the present time. The immigrant banks are reluctant, to furnish data, partly due to suspicion and partly to their manner of conducting business, whereby frequently personal and customers' accounts are merged.

Other practical difficulties are that (a) there is no way of separating noncommercial from commercial bank drafts; (b) it is difficult to distinguish between various types of "invisible" payment, such as tourists' expenditures, relief, currency speculation, and immigrant remittances; (c) the currency specified in the foreign exchange is no clear index, since international remittances payable in any country may be drawn in dollars, pounds sterling, and other international currencies; and (d) there is no way of knowing the exact rate of conversion for the single transaction. The daily published rate is merely a barometer.

But anyone familiar with the conditions can not question that hundreds of millions of dollars leave America yearly in the form of immigrant remittances. For the postwar period my estimate is from $400,000,000 to $500,000,000 per

annum.

The alien immigrant frequently returns to his native country. From the time that the immigrant sets foot over American borders and until he leaves the country his economic status has obviously undergone a change. Has his residence in America made him more valuable or a less valuable economic unit? Probably it is correct to state that the former emigrant returns to his native land with an enhanced earning capacity, and with some store of wealth in addition. There are notable exceptions in the instance of persons, absent from their country during the most productive years of their life, who have undergone disease, physical strain, or injury. Nor should we overlook the frequent instances of the successful migrants who return to live a life of idleness in small communities where they establish the fashions and habits of the neighborhood. Yet there seems to be every justification for assuming that the knowledge and experience gained in America must cause, as a general rule, an enhancement of the personal worth. The actual or percentage difference between (a), the personal value of the immigrant, and (b), the personal value of the returning emigrant, is difficult to ascertain, although certain standards of measurement can be devised. As far as the writer is aware, no figures have been compiled which contrast the changed economic value of any single individual or of any racial group.

NEGLECTED ASPECT OF PERPLEXING PROBLEM

This contribution to a neglected aspect of the perplexing immigration problem is presented with a keen appreciation that the sociological features have been almost wholly unmentioned. On the financial side, the accumulated material presented opens the door for the introduction of a fresh statement of principles relative to immigration, since we can proceed by gauging direct and indirect losses in terms of the economic worth of the Individuals and of the goods or money they cause to be transferred from one economic sphere to another. Primarily,

17 The foregoing figures and deductions, taken from The Review of Economic Statistics, Prel. Vol. IV. No. 3, have not taken into account all items which might be considered. For example, foreign tourists in the United States, judged by Paish as spending $30,000,000 annually; remittances from Americans resident abroad; American fortunes which are used for European dowries; speculation in foreign currencies; expenses of American Government and private offices abroad, and foreign in America; certain forms of capital taken by Americans who settle in Canada, Mexico, Cuba, etc.; and foreign purchases by military and naval forces. A tremendous item during the World War consisted of commodities, transported on American naval and requisitioned ships, which do not appear in the official trade returns. Another obstacle is the unusual practice of valuing American imports at the wholesale price in the country of origin. Hereafter, those articles which are subject to American valuation will be accorded values which include freight, insurance, and miscellaneous charges, thereby giving an appearance of a less "favorable" trade balance. Able discussions of foreign trade figures are given by Sir R. Giffen, Journal of the Statistical Society, Vol. XLV. pp. 181-296; G. M. Fisk, International Commercial Policies, ch. xvi; F. R. Rutter, Quarterly Publications of the American Statistical Association, Vol. XV. pp. 16-34; publications by the Treasury and Commerce Departments. Addenda to the excellent Harvard studies would probably result in larger "visible" and "invisible" export items.

18 Emigration and Immigration, 1890, pp. 99-100. He states further that the British Board of Trade had included remittances in the "Statistical Tables relating to Emigration and Immigration from and into the United Kingdom," but abandoned the experiment in 1888 because private bankers were unwilling to furnish the desired information.