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Minimum wages and the creation of illegal migration

Author

Listed:
  • Gil S. Epstein

    () (Bar-Ilan University, CReAM, IZA)

  • Odelia Heizler (Cohen)

    () (Department of Economics and Management, Tel-Aviv-Yaffo Academic College and IZA, Bonn.)

Abstract

In this paper, we explore employers' decisions regarding the employment of legal and illegal immigrants in the presence of endogenous adjustment cost, minimum wages and an enforcement budget. We show that increasing the employment of legal foreign workers will increase the number of illegal immigrants which will replace the employment of the local population and thus creating illegal migration.

Suggested Citation

  • Gil S. Epstein & Odelia Heizler (Cohen), 2013. "Minimum wages and the creation of illegal migration," Economics Bulletin, AccessEcon, vol. 33(1), pages 434-441.
  • Handle: RePEc:ebl:ecbull:eb-12-00870
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2013/Volume33/EB-13-V33-I1-P42.pdf
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    References listed on IDEAS

    as
    1. Epstein, Gil S. & Heizler (Cohen), Odelia, 2007. "Illegal Migration, Enforcement and Minimum Wage," IZA Discussion Papers 2830, Institute for the Study of Labor (IZA).
    2. Faini,Riccardo C. & de Melo,Jaime & Zimmermann,Klaus (ed.), 1999. "Migration," Cambridge Books, Cambridge University Press, number 9780521662338.
    3. Gil S. Epstein, 2003. "Labor Market Interactions Between Legal and Illegal Immigrants," Review of Development Economics, Wiley Blackwell, vol. 7(1), pages 30-43, February.
    4. Avi Weiss & Arye L. Hillman & Gil S. Epstein, 1999. "Creating illegal immigrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 12(1), pages 3-21.
    5. Faria, Joao Ricardo & Levy, Amnon, 2003. "Illegal Immigration and Migrant Networks: Is There an Optimal Immigration Quota Policy?," Economics Working Papers wp03-08, School of Economics, University of Wollongong, NSW, Australia.
    6. Paul Levine, 1999. "The welfare economics of immigration control," Journal of Population Economics, Springer;European Society for Population Economics, vol. 12(1), pages 23-43.
    7. Devillanova, Carlo, 2008. "Social networks, information and health care utilization: Evidence from undocumented immigrants in Milan," Journal of Health Economics, Elsevier, vol. 27(2), pages 265-286, March.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    illegal immigration; foreign worker; minimum wages;

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • K4 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior

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