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Temporary Migration Policies and Welfare of the Host and Source Countries: A Game-Theoretic Approach

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  • Slobodan Djajic
  • Michael S. Michael

Abstract

This paper examines the interaction between migration policies of the host and source countries in the context of a model of guest-worker migration. For the host, the objective is to provide low-cost labor for its employers while avoiding illegal immigration. It optimizes over these objectives by setting the time limit of a guest-worker permit. The source country seeks remittance flows and return migration by offering fiscal benefits to returnees. Within this framework, we solve for the Nash equilibrium values of the migration policy instruments and compare them with the ones that emerge in a cooperative setting.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2009/wp-cesifo-2009-10/cesifo1_wp2811.pdf
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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2811.

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Date of creation: 2009
Date of revision:
Handle: RePEc:ces:ceswps:_2811

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Related research

Keywords: temporary migration; remittances; migration policy;

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References

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  1. Quibria, M G, 1997. "International Migration, Remittances and Income Distribution in the," Bulletin of Economic Research, Wiley Blackwell, vol. 49(1), pages 29-46, January.
  2. L. Alan Winters & Terrie L. Walmsley & Zhen Kun Wang & Roman Grynberg, 2003. "Liberalising Temporary Movement of Natural Persons: An Agenda for the Development Round," The World Economy, Wiley Blackwell, vol. 26(8), pages 1137-1161, 08.
  3. Claus Aastrup Jensen & Nikolaj Malchow-M�ller & Jan Rose Skaksen, 2010. "Does coordination of immigration policies among destination countries increase immigration?," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 19(3), pages 357-384.
  4. Djajic, Slobodan, 1998. "Emigration and welfare in an economy with foreign capital," Journal of Development Economics, Elsevier, vol. 56(2), pages 433-445, August.
  5. Schiff, Maurice, 2007. "Optimal Immigration Policy: Permanent, Guest-Worker, or Mode IV?," IZA Discussion Papers 2871, Institute for the Study of Labor (IZA).
  6. Alan de Brauw & Scott Rozelle, 2003. "Household Investment through migration in Rural China," Department of Economics Working Papers 2003-01, Department of Economics, Williams College.
  7. Jones, Ronald W. & Coelho, Isaias & Easton, Stephen T., 1986. "The theory of international factor flows: The basic model," Journal of International Economics, Elsevier, vol. 20(3-4), pages 313-327, May.
  8. Lucas, Robert E B, 1987. "Emigration to South Africa's Mines," American Economic Review, American Economic Association, vol. 77(3), pages 313-30, June.
  9. Calvo, Guillermo & Wellisz, Stanislaw, 1983. "International factor mobility and national advantage," Journal of International Economics, Elsevier, vol. 14(1-2), pages 103-114, February.
  10. Timothy J. Hatton, 2007. "Should we have a WTO for international migration?," Economic Policy, CEPR & CES & MSH, vol. 22, pages 339-383, 04.
  11. Adams, Richard H, Jr, 1991. "The Economic Uses and Impact of International Remittances in Rural Egypt," Economic Development and Cultural Change, University of Chicago Press, vol. 39(4), pages 695-722, July.
  12. Woodruff, Christopher & Zenteno, Rene, 2007. "Migration networks and microenterprises in Mexico," Journal of Development Economics, Elsevier, vol. 82(2), pages 509-528, March.
  13. Djajic, Slobodan, 1986. "International migration, remittances and welfare in a dependent economy," Journal of Development Economics, Elsevier, vol. 21(2), pages 229-234, May.
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Cited by:
  1. Pawel Kaczmarczyk, 2013. "Are immigrants a burden for the state budget? Review paper," EUI-RSCAS Working Papers p0356, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
  2. Moritz Bonn, 2013. "On the Interdependence of Illegal and Legal Immigration," MAGKS Papers on Economics 201301, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).

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