International Migration with Heterogeneous Agents: Theory and Evidence for Germany, 1967-2009
AbstractTemporary migration, though empirically relevant, is often ignored in formal models. This paper proposes a migration model with heterogeneous agents and persistent cross country income differentials that features temporary migration. In equilibrium there exists a positive relation between the stock of migrants and the income differential, while the net migration ﬂow becomes zero. Consequently, existing empirical migration models, estimating net migration ﬂows, instead of stocks, may be misspeciﬁed. This suspicion appears to be conﬁrmed by our investigation of the cointegration relationships of German migration stocks and ﬂows since 1967. We ﬁnd that (i) panel-unit root tests reject the hypothesis that migration ﬂows and the explanatory variables are integrated of the same order, while migration stocks and the explanatory variables are all I(1) variables, and (ii) the hypothesis of cointegration cannot be rejected for the stock model.
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Bibliographic InfoPaper provided by Norface Research Programme on Migration, Department of Economics, University College London in its series Norface Discussion Paper Series with number 2011027.
Date of creation: Dec 2011
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International migration; temporary migration; panel cointegration;
Other versions of this item:
- Herbert Brücker & Philipp J. H. Schröder, 2012. "International Migration With Heterogeneous Agents: Theory and Evidence for Germany, 1967–2009," The World Economy, Wiley Blackwell, vol. 35(2), pages 152-182, 02.
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Longitudinal Data; Spatial Time Series
- C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
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