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Optimal Immigration, Assimilation and Trade

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  • Istvan Konya

    (Boston College
    Boston College)

Abstract

The paper develops a general equilibrium model of migration, assimilation and trade, using a random matching framework of culture and trade. The market equilibrium and the social plannerÕs solution are contrasted and policy implications are given. The model predicts that the presence of immigrants who do not assimilate into the mainstream culture is economically inefficient, but whether such migration occurs depends on the underlying parameters. Because of the endogeneity of the migration decision, care must be taken to select the optimal policy instruments. In particular, subsidizing assimilation or auctioning immigration permits do not achieve the first best. Instead, a mix of selective immigration, border control and aid to the source country can be used to promote efficiency.

Suggested Citation

  • Istvan Konya, 2001. "Optimal Immigration, Assimilation and Trade," Boston College Working Papers in Economics 507, Boston College Department of Economics.
  • Handle: RePEc:boc:bocoec:507
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    References listed on IDEAS

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    More about this item

    Keywords

    culture; immigration policy; optimal immigration;
    All these keywords.

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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