How much of your economic future is decided before you make your first choice?
Imagine two people with similar abilities.
Both are willing to work. Both want to build better lives. Neither chose the country into which they were born.
But one grows up in a rich country and the other in a much poorer one.
Even before either makes an important personal choice, their economic prospects may already be very different.
Economist Branko Milanovic has spent much of his career studying inequality at the global level.
His work leads to an uncomfortable question:
How much of a person’s economic future is shaped by the country in which that person is born—and later lives?
Milanovic calls part of this advantage a citizenship premium.
Inequality Between Countries
When we think about inequality, we often look inside a country.
Who is rich?
Who is poor?
How unequal are wages?
How much wealth does the top one percent hold?
These are important questions.
But Milanovic asks us to widen the frame.
A person’s position in the world income distribution depends not only on whether that person is rich or poor within one country. It also depends heavily on whether the country in which that person lives is rich or poor.
In one specification of his 2015 study, country differences alone explained almost three-quarters of the observed variation in incomes across the global distribution.
That does not mean individual effort is irrelevant.
It means that location creates extraordinarily different economic starting conditions.
The difference between two people may not simply be:
one worked harder.
It may also be:
one began life inside a much richer economic and political environment.
What Is a Citizenship Premium?
Milanovic uses the language of a citizenship premium or citizenship rent to describe the economic advantage associated with being located in a richer country.
The term should not be read as meaning that legal citizenship alone produces the income difference.
The institutions, productivity, infrastructure, labor market, public services, security, and accumulated wealth of a country all matter.
Workers with similar skills can receive very different incomes depending on where they live and work.
That is the deeper point.
The economic value of a person’s labor is shaped not only by individual effort or skill, but also by the surrounding economic environment.
Citizenship Is Not Quite the Right Word
There is an important qualification.
Citizenship and residence are not always the same.
A person may be a citizen of one country while living and working in another.
For that reason, in later work Milanovic explicitly uses country of residence rather than legal citizenship when measuring how location affects income.
So “citizenship premium” is best understood as a way of drawing attention to the enormous economic importance of a person’s position in the global system.
Where a person lives can strongly shape what that person is able to earn.
Why Migration Matters
Once this is visible, migration takes on a different meaning.
Suppose a worker can earn much more by doing similar work in another country.
Migration can substantially increase the incomes of some migrants and can reduce certain forms of global income inequality, although its effects vary and receiving communities can face real adjustment costs.
If where a person lives has enormous effects on economic opportunity, then rules determining who may cross borders also affect access to opportunity.
This is where Milanovic’s work connects with the World Citizen framework.
Milanovic is primarily analyzing inequality.
The World Citizen framework asks a different question:
What political freedom should people have when their opportunities depend so strongly on the political community in which they are allowed to live?
I call one part of that freedom Foot Democracy.
Foot Democracy is not simply the ability to leave a country.
It means having a meaningful possibility of choosing another political community: entering it, establishing a life there, and over time developing a route toward membership.
Milanovic’s research does not itself establish such a right.
An empirical finding about inequality cannot by itself prove a political principle.
But it makes the problem harder to ignore.
More Migration, Fewer Rights?
Milanovic does not stop at diagnosing the citizenship premium.
He also asks how richer countries might become willing to accept more migrants.
In Global Inequality: A New Approach for the Age of Globalization, he considers arrangements in which larger migration flows are combined with differentiated status for migrants.
That might include different tax treatment, temporary residence, restrictions on family reunification, or an obligation to return.
The political logic is clear.
Existing citizens may be more willing to accept additional immigration if newcomers do not immediately receive every advantage attached to full membership.
This confronts a real problem.
But here the World Citizen framework sets a different limit.
It can accept transitional differences and staged rights.
Not everyone who crosses a border must immediately become a full political member.
But temporary difference cannot become permanent political inferiority.
If residence becomes durable, there must be a credible route toward equal political membership.
This is where Milanovic’s migration proposal and Resident Sovereignty begin to diverge.
The question is not only how many people a community should admit.
It is also what status those people should have after they have built their lives there.
Migration Is Not an Obligation
The World Citizen framework does not say that everyone in a poorer country should move to a richer one.
People have homes, families, languages, histories, communities, and attachments.
Many people do not want to leave.
A just system cannot answer global inequality by saying:
If your country is poor, move somewhere richer.
Development where people already live remains important.
So does the freedom to remain.
Political freedom should expand options, not turn migration into an obligation.
What About the Receiving Community?
There is also another side of the problem.
If the economic gains from moving to richer countries are large, many people may want to move to the same places.
Those communities have housing systems, schools, transportation networks, public budgets, labor markets, and administrative limits.
The individual may have a powerful reason to move.
The receiving community may have legitimate concerns about the volume, speed, and concentration of migration.
The World Citizen framework does not solve that conflict by declaring one side absolute.
Foot Democracy must exist alongside Hand Democracy—the ability of people living in a community to govern their shared institutions.
The difficult question is how those freedoms should be reconciled.
That question will be the subject of the next article.
From Shachar to Milanovic
In “Ayelet Shachar and the Birthright Lottery”, the problem was inherited political membership.
In “From Nationality to Residence”, the question became whether durable residence should gain greater weight as a basis of membership.
Milanovic adds the economic dimension.
His work shows how strongly opportunity can depend on national location.
The common thread is simple:
birth places people into political and economic circumstances they did not choose.
The remaining question is how much power those circumstances should retain over the rest of their lives.
Conclusion
Milanovic’s citizenship premium reveals something that national statistics can hide.
A person may work hard, gain skills, and make careful choices.
Yet the economic value of those efforts can still depend enormously on where that person is allowed to live.
That does not make individual effort meaningless.
It means effort takes place inside institutions and economies that people do not choose at birth.
The World Citizen framework begins from that fact but moves in a political direction.
If political borders divide access to radically different opportunities, people need more than a formal freedom to leave.
They need a meaningful capacity to change the political community in which they build their lives.
If location shapes opportunity, then the freedom to change location is also a question of political freedom.
That is where Milanovic’s citizenship premium meets Foot Democracy.
Notes
Milanovic has used both citizenship premium and citizenship rent to describe advantages associated with membership in richer countries. These are analytical economic terms, not claims that citizenship is literally a private property right.
Earlier work by Milanovic used citizenship or country-related circumstances assigned at birth. Later analysis gives greater emphasis to country of residence, because citizenship and residence can diverge.
References
Milanovic, Branko. “Global Inequality of Opportunity: How Much of Our Income Is Determined at Birth?” World Bank, 2009.
Milanovic, Branko. “Global Inequality: From Class to Location, from Proletarians to Migrants.” Global Policy 3, no. 2 (2012): 125–134.
Milanovic, Branko. “Global Income Inequality in Numbers: In History and Now.” Global Policy 4, no. 2 (2013): 198–208.
Milanovic, Branko. “Global Inequality of Opportunity: How Much of Our Income Is Determined by Where We Live?” Review of Economics and Statistics 97, no. 2 (2015): 452–460.
Milanovic, Branko. Global Inequality: A New Approach for the Age of Globalization. Harvard University Press, 2016.
Nishimura, Toshiyuki. The World Citizen Revolution. 2026.
Nishimura, Toshiyuki. The World Citizen Society: Political Freedom, Democratic Choice, and the Institutions of a New Society. 2026.
Further Reading
For the World Citizen framework’s argument about political-community choice, see The World Citizen Revolution, especially the discussion of Migration Freedom and Foot Democracy.
For the institutional design of Entry, residence, and political membership, see The World Citizen Society.
Related concepts on this site: Foot Democracy, Migration Freedom, and Resident Sovereignty.
