Migration: a burden or a blessing for natives?
AbstractWe analyse the effects of migration on the production of public goods, income taxes, and on the welfare of residents in the sending and in the receiving country. Migration is based on income differences between countries. Different alternative scenarios are considered. In the first, we assume fully flexible wages in both countries and we show that migration is welfare detrimental only for origin country. In the second scenario, wages are rigid. With upward wage rigidity, migration has detrimental effects for natives of the origin country but it brings benefits to the natives of the destination country. Finally, migration can be welfare detrimental for both countries, under downward wage rigidities.
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Bibliographic InfoPaper provided by Center for Research in Economic Analysis, University of Luxembourg in its series CREA Discussion Paper Series with number 14-01.
Date of creation: 2014
Date of revision:
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More information through EDIRC
migration; public goods; income taxes; labor market rigidities;
Find related papers by JEL classification:
- F2 - International Economics - - International Factor Movements and International Business
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
- H4 - Public Economics - - Publicly Provided Goods
This paper has been announced in the following NEP Reports:
- NEP-ALL-2014-03-22 (All new papers)
- NEP-MIG-2014-03-22 (Economics of Human Migration)
- NEP-PBE-2014-03-22 (Public Economics)
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