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How many cake-eaters? Chouette, on a du monde a diner !

  • Favard, Pascal
  • Karp, Larry

We use a cake-eating model with a non-renewable resource and a backstop technology to describe the effect of migration of poor workers into a rich country with surplus labor. Migrants receive a large transfer from natives. If future migration is anticipated, natives' flow of utility increases discontinuously at the time of migration. Migration at time 0 may cause the~ initial flow of natives~ utility to be higher. However, the present discounted value of the stream of per capita utility falls. Thus, when migration occurs, it may benefit the current generation of natives, although it harms other generations.

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Article provided by Elsevier in its journal Journal of Economic Dynamics and Control.

Volume (Year): 28 (2004)
Issue (Month): 4 (January)
Pages: 801-815

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Handle: RePEc:eee:dyncon:v:28:y:2004:i:4:p:801-815
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  1. Ethier, Wilfred J, 1986. "Illegal Immigration: The Host-Country Problem," American Economic Review, American Economic Association, vol. 76(1), pages 56-71, March.
  2. Bond, Eric W. & Chen, Tain-Jy, 1987. "The welfare effects of illegal immigration," Journal of International Economics, Elsevier, vol. 23(3-4), pages 315-328, November.
  3. Amigues, J-P & Favard, Gaudet, G. & Moreaux, M, 1996. "On the Optimal Order of Natural Resource Use When the Capacity of the Inexhaustible Substitute is Limited," Cahiers de recherche 9628, Centre interuniversitaire de recherche en ├ęconomie quantitative, CIREQ.
  4. Caputo, Michael R, 1990. "Comparative Dynamics via Envelope Methods in Variational Calculus," Review of Economic Studies, Wiley Blackwell, vol. 57(4), pages 689-97, October.
  5. Kemp, Murray C & Long, Ngo Van, 1980. "On Two Folk Theorems Concerning the Extraction of Exhaustible Resources," Econometrica, Econometric Society, vol. 48(3), pages 663-73, April.
  6. Djajic, Slobodan, 1987. "Illegal aliens, unemployment and immigration policy," Journal of Development Economics, Elsevier, vol. 25(1), pages 235-249, February.
  7. LaFrance, Jeffrey T. & Barney, L. Dwayne, 1991. "The envelope theorem in dynamic optimization," Journal of Economic Dynamics and Control, Elsevier, vol. 15(2), pages 355-385, April.
  8. Baker, Michael & Benjamin, Dwayne, 1994. "The Performance of Immigrants in the Canadian Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 12(3), pages 369-405, July.
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