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Rational Migration Policy Should Tolerate Non-Zero Illegal Migration Flows: Lessons from Modelling the Market for Illegal Migration

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  • Entorf, Horst

    ()
    (Goethe University Frankfurt)

Abstract

The debate on the immigration policies in OECD countries has turned its attention towards illegal migrants. Given that migration flows are determined by immigration laws, the probability of potential detection, penalties for unauthorised migrants and their employers, and on income differences between sending and receiving countries, this paper presents a new approach to the problem of illegal migration, grounded on the economic theory of illegal behaviour. The framework considers the interaction of potential migrants, citizens, employers, and the government. After introducing the supply function of illegal migration and its determinants, the trade-off between social costs and benefits of preventing and combating illegal migration is demonstrated. This trade-off results in an optimal level of migration larger than zero. A complete "market model" of illegal migration is offered by presentation of a demand curve of illegal migration, based on the tolerance of the society towards clandestine foreigners. Equilibrium forces predict a non-zero level of illegal migration. The rule of law of our legal systems, according to which any illegal activity has to be reduced to zero, bears the danger of producing inefficient disequilibria. A reasonable policy of wanted and unwanted migration should address the question of how to allocate scarce resources. Ignoring social optima and equilibrium forces means to abandon public resources that could be used for other public assignments, such as schooling, or foreign aid, for instance, i.e., measures that could strike the problem of illegal migration at its root.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 199.

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Length: 27 pages
Date of creation: Sep 2000
Date of revision:
Publication status: published in: International Migration, 40 (1), 2002, 27-43
Handle: RePEc:iza:izadps:dp199

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Keywords: social costs and benefits; migration policy; rational behaviour; Illegal migration;

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References

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  1. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-65, May-June.
  2. Gary S. Becker, 1968. "Crime and Punishment: An Economic Approach," Journal of Political Economy, University of Chicago Press, vol. 76, pages 169.
  3. Chisato Yoshida, 1993. "The Global Welfare of Illegal Immigration: A Note," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 28(1), pages 111-115, January.
  4. Djajic, Slobodan, 1997. "Illegal Immigration and Resource Allocation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(1), pages 97-117, February.
  5. Entorf, Horst & Spengler, Hannes, 1998. "Socio-economic and demographic factors of crime in Germany: evidence from panel data of the German states," ZEW Discussion Papers 98-16, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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Cited by:
  1. Munirul H Nabin & Pasquale M Sgro, 2010. "Employer Sanctions, Illegal Migration and Welfare," Economics Series 2010_01, Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance.
  2. Bchir, Mohamed Hedi, 2008. "The effect of mode 4 liberalization on illegal immigration," Economic Modelling, Elsevier, vol. 25(5), pages 1051-1063, September.
  3. Christian Lumpe & Benjamin Weigert, 2004. "Immigration, Education and Labour Market Institutions," Working Papers of the Research Group Heterogenous Labor 04-14, Research Group Heterogeneous Labor, University of Konstanz/ZEW Mannheim.
  4. Entorf, Horst & Möbert, Jochen, 2004. "The Demand for Illegal Migration and Market Outcomes," Darmstadt Discussion Papers in Economics 37283, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute of Economics (VWL).

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