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Temporary migration, indeterminacy and growth

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  • Parello, Carmelo Pierpaolo

Abstract

This study develops a one-sector, small open economy growth model to examine the effects of temporary migration on macroeconomic stability and growth of host countries. The analysis focuses on general production technology, treating native and immigrant workers as distinct labor inputs. Findings suggest that diminished marginal returns to capital may be responsible for the emergence of equilibrium indeterminacy. However, when the social benefits of production differ from private benefits, the model exhibits a unique saddle-path equilibrium with no endogenous growth.

Suggested Citation

  • Parello, Carmelo Pierpaolo, 2025. "Temporary migration, indeterminacy and growth," Economic Modelling, Elsevier, vol. 149(C).
    • Handle: RePEc:eee:ecmode:v:149:y:2025:i:c:s0264999325001075
    DOI: 10.1016/j.econmod.2025.107112
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    Keywords

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    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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