Smuggling Humans: A Theory of Debt-Financed Migration
AbstractWe introduce financial constraints in a theoretical analysis of illegal immigration. Intermediaries finance the migration costs of wealth-constrained migrants, who enter temporary servitude contracts to pay back the debt. These debt/labor contracts are more easily enforceable in the illegal than in the legal sector of the host country. Hence, when moving from the illegal to the legal sector becomes more costly, for instance, because of stricter deportation policies, fewer immigrants default on debt. This reduces the risks for intermediaries, who are then more willing to finance illegal migration. Stricter deportation policies may thus increase rather than decrease the ex ante flow of illegal migrants. We also show that stricter deportation policies worsen the skill composition of immigrants. While stricter border controls decrease overall immigration, they may also result in an increase of debt-financed migration.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1025.
Length: 30 pages
Date of creation: Feb 2004
Date of revision:
Publication status: published in: Journal of the European Economic Association, 2006, 4 (6), 1085-1111
Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Other versions of this item:
- Guido Friebel & Sergei Guriev, 2006. "Smuggling Humans: A Theory of Debt-financed Migration," Journal of the European Economic Association, MIT Press, vol. 4(6), pages 1085-1111, December.
- Friebel, Guido & Guriev, Sergei, 2004. "Smuggling Humans: A Theory of Debt-Financed Migration," CEPR Discussion Papers 4305, C.E.P.R. Discussion Papers.
- Guido Friebel & Sergei Guriev, 2002. "Smuggling Humans: A Theory of Debt-Financed Migration," Working Papers w0058, Center for Economic and Financial Research (CEFIR), revised Dec 2005.
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
- O17 - Economic Development, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
- J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
- N21 - Economic History - - Financial Markets and Institutions - - - U.S.; Canada: Pre-1913
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-02-29 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Katharine Donato & Jorge Durand & Douglas Massey, 1992. "Stemming the tide? Assessing the deterrent effects of the immigration reform and control act," Demography, Springer, vol. 29(2), pages 139-157, May.
- Galenson, David W., 1984. "The Rise and Fall of Indentured Servitude in the Americas: An Economic Analysis," The Journal of Economic History, Cambridge University Press, vol. 44(01), pages 1-26, March.
- Gil S. Epstien & Avi Weiss, 2001.
"A Theory of Immigration Amnesties,"
2001-09, Department of Economics, Bar-Ilan University.
- Hanson, G.H. & Robertson, R. & Spilimbergo, A., 1999.
"Does Border Enforcement Protect U.S. Workers from Illegal Immigration?,"
438, Research Seminar in International Economics, University of Michigan.
- Gordon H. Hanson & Raymond Robertson & Antonio Spilimbergo, 2002. "Does Border Enforcement Protect U.S. Workers From Illegal Immigration?," The Review of Economics and Statistics, MIT Press, vol. 84(1), pages 73-92, February.
- Gordon H. Hanson & Raymond Robertson & Antonio Spilimbergo, 1999. "Does Border Enforcement Protect U.S. Workers from Illegal Immigration?," NBER Working Papers 7054, National Bureau of Economic Research, Inc.
- Tirole, Jean, 2001.
Econometric Society, vol. 69(1), pages 1-35, January.
- Viscusi, W Kip & Aldy, Joseph E, 2003.
" The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World,"
Journal of Risk and Uncertainty,
Springer, vol. 27(1), pages 5-76, August.
- Aldy, Joseph E. & Viscusi, W. Kip, 2003. "The Value of Statistical Life: A Critical Review of Market Estimates throughout the World," Working paper 282, Regulation2point0.
- W. Kip Viscusi & Joseph E. Aldy, 2003. "The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World," NBER Working Papers 9487, National Bureau of Economic Research, Inc.
- Genicot, Garance, 2002. "Bonded labor and serfdom: a paradox of voluntary choice," Journal of Development Economics, Elsevier, vol. 67(1), pages 101-127, February.
- Avi Weiss & Arye L. Hillman & Gil S. Epstein, 1999.
"Creating illegal immigrants,"
Journal of Population Economics,
Springer, vol. 12(1), pages 3-21.
- Chau, Nancy H, 2001. "Strategic Amnesty and Credible Immigration Reform," Journal of Labor Economics, University of Chicago Press, vol. 19(3), pages 604-34, July.
- Guillermina Jasso & Douglas Massey & Mark Rosenzweig & James Smith, 2000.
"The new immigrant survey pilot (NIS-P): Overview and new findings about U.S. Legal immigrants at admission,"
Springer, vol. 37(1), pages 127-138, February.
- Guillermina Jasso & Douglas S. Massey & Mark R. Rosenzweig & James P. Smith, 2004. "The New Immigrant Survey Pilot (NIS-P): Overview and New Findings about U.S. Legal Immigrants at Admission," Labor and Demography 0403002, EconWPA.
- Chiswick, Barry R. & Hatton, Timothy J., 2002.
"International Migration and the Integration of Labor Markets,"
IZA Discussion Papers
559, Institute for the Study of Labor (IZA).
- Barry Chiswick & Timothy J.. Hatton, 2003. "International Migration and the Integration of Labor Markets," NBER Chapters, in: Globalization in Historical Perspective, pages 65-120 National Bureau of Economic Research, Inc.
- Kossoudji, S.A. & Cobb-Clark, D.A., 1996.
"Coming Out of the Shadows: Learning About Legal Status and Wages from the Legalized Population,"
CEPR Discussion Papers
347, Centre for Economic Policy Research, Research School of Economics, Australian National University.
- Sherrie A. Kossoudji & Deborah A. Cobb-Clark, 2002. "Coming out of the Shadows: Learning about Legal Status and Wages from the Legalized Population," Journal of Labor Economics, University of Chicago Press, vol. 20(3), pages 598-628, July.
- Slobodan Djajic, 1999. "Dynamics of immigration control," Journal of Population Economics, Springer, vol. 12(1), pages 45-61.
- Piketty, Thomas, 2000. "Theories of persistent inequality and intergenerational mobility," Handbook of Income Distribution, in: A.B. Atkinson & F. Bourguignon (ed.), Handbook of Income Distribution, edition 1, volume 1, chapter 8, pages 429-476 Elsevier.
- Klaus F. Zimmermann, 1995. "Tackling the European Migration Problems," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 45-62, Spring.
- repec:reg:rpubli:282 is not listed on IDEAS
- Kevin H. O'Rourke & Jeffrey G. Williamson, 2001. "Globalization and History: The Evolution of a Nineteenth-Century Atlantic Economy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262650592, January.
- Francisco L. Rivera-Batiz, 1999. "Undocumented workers in the labor market: An analysis of the earnings of legal and illegal Mexican immigrants in the United States," Journal of Population Economics, Springer, vol. 12(1), pages 91-116.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).
If references are entirely missing, you can add them using this form.