Controlling Illegal Immigration: On the Scope for Cooperation with a Transit Country

We consider the implications of cooperation with respect to immigration control between a final-destination country (D) and its poorer neighbor (T). Assuming that the latter serves as a transit country for undocumented immigrants, a key question is how much aid should D provide to T for the purpose of strengthening its immigration controls. The problem for T is to determine what proportion of aid to use strictly for immigration control rather than trying to meet other border-security objectives. We examine the Nash equilibrium values of the policy instruments of both countries and compare them with those which are optimal when international cooperation on immigration control extends to maximization of joint welfare. We also consider a two-stage game in which D first decides on how much aid to transfer to T, with the latter subsequently choosing how to use it.