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Can International Migration Ever Be Made a Pareto Improvement?

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  • Wilhelm Kohler
  • Gabriel Felbermayr

Abstract

We argue that compensating losers is more difficult for immigration than for trade and capital movements. While a tax-cum-subsidy mechanism allows the government to turn the gains from trade into a Pareto improvement, the same is not true for the so-called immigration surplus, if the redistributive mechanism is not allowed to discriminate against migrants. We discuss policy conclusions to be drawn from this fundamental asymmetry between migration and other forms of globalization.

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Paper provided by University of Nottingham, GEP in its series Discussion Papers with number 09/01.

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Handle: RePEc:not:notgep:09/01

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Keywords: Migration Surplus; Redistribution; Pareto Improvement;

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References

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  1. Richard B. Freeman, 2006. "People Flows in Globalization," NBER Working Papers 12315, National Bureau of Economic Research, Inc.
  2. Kohler, Wilhelm K., 2004. "Eastern Enlargement of the EU : A Comprehensive Welfare Assessment," HWWA Discussion Papers, Hamburg Institute of International Economics (HWWA) 260, Hamburg Institute of International Economics (HWWA).
  3. Stark, Oded & Wang, Yong, 2002. "Inducing human capital formation: migration as a substitute for subsidies," Journal of Public Economics, Elsevier, Elsevier, vol. 86(1), pages 29-46, October.
  4. George J. Borjas, 1995. "The Economic Benefits from Immigration," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 9(2), pages 3-22, Spring.
  5. Peter J. Hammond & Jaime Sempere, . "Gains from Trade versus Gains from Migration: What Makes Them So Different?," Working Papers, Stanford University, Department of Economics 98012, Stanford University, Department of Economics.
  6. Kohler, Wilhelm, 2004. "Eastern enlargement of the EU: a comprehensive welfare assessment," Journal of Policy Modeling, Elsevier, Elsevier, vol. 26(7), pages 865-888, October.
  7. Calvo, Guillermo & Wellisz, Stanislaw, 1983. "International factor mobility and national advantage," Journal of International Economics, Elsevier, Elsevier, vol. 14(1-2), pages 103-114, February.
  8. Jagdish Bhagwati & Arvind Panagariya, 2004. "The Muddles over Outsourcing," Journal of Economic Perspectives, American Economic Association, American Economic Association, vol. 18(4), pages 93-114, Fall.
  9. Tito Boeri & Herbert Brücker, 2005. "Why are Europeans so tough on migrants?," Economic Policy, CEPR;CES;MSH, CEPR;CES;MSH, vol. 20(44), pages 629-703, October.
  10. Dixit, Avinash & Norman, Victor, 1986. "Gains from trade without lump-sum compensation," Journal of International Economics, Elsevier, Elsevier, vol. 21(1-2), pages 111-122, August.
  11. Ruffin, Roy J., 1984. "International factor movements," Handbook of International Economics, Elsevier, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 5, pages 237-288 Elsevier.
  12. Borjas, George J., 1999. "The economic analysis of immigration," Handbook of Labor Economics, Elsevier, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 28, pages 1697-1760 Elsevier.
  13. Gabriel J. Felbermayr & Wilhelm Kohler, 2007. "Immigration And Native Welfare," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 48(3), pages 731-760, 08.
  14. Timothy J. Hatton, 2007. "Should we have a WTO for international migration?," Economic Policy, CEPR;CES;MSH, CEPR;CES;MSH, vol. 22, pages 339-383, 04.
  15. L. Alan Winters & Terrie L. Walmsley & Zhen Kun Wang & Roman Grynberg, 2003. "Liberalising Temporary Movement of Natural Persons: An Agenda for the Development Round," The World Economy, Wiley Blackwell, Wiley Blackwell, vol. 26(8), pages 1137-1161, 08.
  16. Markusen, James R., 1983. "Factor movements and commodity trade as complements," Journal of International Economics, Elsevier, Elsevier, vol. 14(3-4), pages 341-356, May.
  17. Willmann, Gerald, 2004. "Pareto gains from trade: a dynamic counterexample," Economics Letters, Elsevier, Elsevier, vol. 83(2), pages 199-204, May.
  18. Davidson, Carl & Matusz, Steven J. & Nelson, Douglas R., 2007. "Can compensation save free trade?," Journal of International Economics, Elsevier, Elsevier, vol. 71(1), pages 167-186, March.
  19. Wellisch, Dietmar & Walz, Uwe, 1998. "Why do rich countries prefer free trade over free migration? The role of the modern welfare state," European Economic Review, Elsevier, Elsevier, vol. 42(8), pages 1595-1612, September.
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As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Can migration be Pareto optimal?
    by Economic Logician in Economic Logic on 2009-07-29 14:40:00

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