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Sustainable migration policies

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  • PICARD, Pierre M.

    ()
    (Département Economie, University of Luxembourg, L-1511 Luxembourg and Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium)

  • WORRALL, Tim

    ()
    (Economics, School of Social Sciences, University of Manchester, U.K.)

Abstract

This paper considers whether countries might mutually agree a policy of open borders, allowing free movement of workers across countries. For the countries to agree, the short run costs must outweighed by the long term benefits that result from better labor market flexibility and income smoothing. We show that such policies are less likely to be adopted when workers are less risk averse workers and when countries trade more. More surprisingly, we find that some congestion costs can help. This reverses the conventional wisdom that congestion costs tend to inhibit free migration policies.

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Bibliographic Info

Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2011040.

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Date of creation: 01 Sep 2011
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Handle: RePEc:cor:louvco:2011040

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Keywords: migration; self-enforcing mechanism; repeated games;

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  1. John Kennan & James R. Walker, 2003. "The Effect of Expected Income on Individual Migration Decisions," NBER Working Papers 9585, National Bureau of Economic Research, Inc.
  2. Ethan Ligon & Jonathan P. Thomas & Tim Worrall, 2002. "Informal Insurance Arrangements with Limited Commitment: Theory and Evidence from Village Economies," Review of Economic Studies, Oxford University Press, vol. 69(1), pages 209-244.
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  12. Duranton, Gilles & Martin, Philippe & Mayer, Thierry & Mayneris, Florian, 2010. "The Economics of Clusters: Lessons from the French Experience," OUP Catalogue, Oxford University Press, number 9780199592203, October.
  13. Jim Dolmas & Gregory W. Huffman, 1998. "On the political economy of immigration and income redistribution," Working Papers 9804, Federal Reserve Bank of Dallas.
  14. Schiff, Maurice, 2006. "Substitution in Markusen's classic trade and factor movement complementarity models," Policy Research Working Paper Series 3974, The World Bank.
  15. Ortega Francesc, 2010. "Immigration, Citizenship, and the Size of Government," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-40, March.
  16. George J. Borjas & Richard B. Freeman, 1992. "Immigration and the Workforce: Economic Consequences for the United States and Source Areas," NBER Books, National Bureau of Economic Research, Inc, number borj92-1.
  17. Asdrubali, Pierfederico & Sorensen, Bent E & Yosha, Oved, 1996. "Channels of Interstate Risk Sharing: United States 1963-1990," The Quarterly Journal of Economics, MIT Press, vol. 111(4), pages 1081-1110, November.
  18. Randall Filer, 1992. "The Effect of Immigrant Arrivals on Migratory Patterns of Native Workers," NBER Chapters, in: Immigration and the Workforce: Economic Consequences for the United States and Source Areas, pages 245-270 National Bureau of Economic Research, Inc.
  19. Markusen, James R., 1983. "Factor movements and commodity trade as complements," Journal of International Economics, Elsevier, vol. 14(3-4), pages 341-356, May.
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