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Gains from Trade versus Gains from Migration: What Makes Them So Different?

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  • Peter J. Hammond
  • Jaime Sempere

Abstract

Latest revision: September 1998. Previous versions appeared under the titles "On Proving Gains from Trade and Migration," and "On the Contrast between Policies toward Trade and Migration." Would unrestricted "economic" migration enhance the potential gains from free trade? First, with free migration feasible sets become non-convex. Under standard assumptions, however, Walrasian equilibrium exists for a continuum of individuals with dispersed ability to afford each of a finite set of possible migration plans. Then familiar conditions ensuring potential Pareto gains from trade also ensure similar supplementary gains from free migration. Second, unlike the standard literature on fiscal externalities, here appropriate policies for providing national public goods, especially those subject to congestion, allow potential Pareto improvements from population exchanges that are regulated only through appropriate residence charges.

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Paper provided by Stanford University, Department of Economics in its series Working Papers with number 98012.

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Handle: RePEc:wop:stanec:98012

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  1. Grossman, Gene M., 1984. "The gains from international factor movements," Journal of International Economics, Elsevier, vol. 17(1-2), pages 73-83, August.
  2. Conley, John P. & Wooders, Myrna, 1996. "Taste-homogeneity of optimal jurisdictions in a Tiebout economy with crowding types and endogenous educational investment choices," Ricerche Economiche, Elsevier, vol. 50(4), pages 367-387, December.
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  4. Conley, John P. & Wooders, Myrna H., 1997. "Equivalence of the Core and Competitive Equilibrium in a Tiebout Economy with Crowding Types," Journal of Urban Economics, Elsevier, vol. 41(3), pages 421-440, May.
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  7. Myers, Gordon M., 1990. "Optimality, free mobility, and the regional authority in a federation," Journal of Public Economics, Elsevier, vol. 43(1), pages 107-121, October.
  8. Jagdish Bhagwati, 1984. "Incentives and disincentives: International migration," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 120(4), pages 678-701, December.
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  13. Wildasin, D.E., 1992. "Income Restribution and Migration," Papers 92-003, Indiana - Center for Econometric Model Research.
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  15. Hamilton, Bob & Whalley, John, 1984. "Efficiency and distributional implications of global restrictions on labour mobility : Calculations and policy implications," Journal of Development Economics, Elsevier, vol. 14(1), pages 61-75.
  16. Yamazaki, Akira, 1978. "An Equilibrium Existence Theorem without Convexity Assumptions," Econometrica, Econometric Society, vol. 46(3), pages 541-55, May.
  17. Mas-Colell, Andreu, 1977. "Indivisible commodities and general equilibrium theory," Journal of Economic Theory, Elsevier, vol. 16(2), pages 443-456, December.
  18. Kar-yiu Wong, 1986. "The Economic Analysis of International Migration: A Generalization," Canadian Journal of Economics, Canadian Economics Association, vol. 19(2), pages 357-62, May.
  19. Tu, Pierre N V, 1991. "Migration: Gains or Losses?," The Economic Record, The Economic Society of Australia, vol. 67(197), pages 153-57, June.
  20. Konishi, Hideo, 1996. "Voting with Ballots and Feet: Existence of Equilibrium in a Local Public Good Economy," Journal of Economic Theory, Elsevier, vol. 68(2), pages 480-509, February.
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  22. Richard A. Brecher & Ehsan U. Choudhri, 1990. "Gains from International Factor Movements without Lump-Sum Compensation: Taxation by Location versus Nationality," Canadian Journal of Economics, Canadian Economics Association, vol. 23(1), pages 44-59, February.
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Cited by:
  1. Peter Hammond & Jaume Sempere, 2009. "Migration with local public goods and the gains from changing places," Economic Theory, Springer, vol. 41(3), pages 359-377, December.
  2. Bougheas, Spiros & Nelson, Doug, 2013. "On the political economy of high skilled migration and international trade," European Economic Review, Elsevier, vol. 63(C), pages 206-224.
  3. Gabriel J Felbermayr & Wilhelm Kohler, 2009. "Can International Migration Ever Be Made a Pareto Improvement?," Diskussionspapiere aus dem Institut für Volkswirtschaftslehre der Universität Hohenheim 305/2009, Department of Economics, University of Hohenheim, Germany.
  4. Gligorov, Vladimir, 2009. "Mobility and Transition in Integrating Europe," MPRA Paper 19198, University Library of Munich, Germany.

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