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Undocumented migrants in debt

  • Djajić, Slobodan
  • Vinogradova, Alexandra
Registered author(s):

    Numerous studies suggest that illegal immigration in the form of bonded labor is becoming an increasingly important phenomenon. This paper develops a model of optimizing behavior of undocumented immigrants who are employed in the host country as bonded laborers while repaying their debts to human smugglers. The analysis relates the optimal duration of the repayment period and the migrant's consumption path to the stock of debt, the rate of interest charged by the smuggler and the levels of the bonded and free-market wages in the destination country. This provides a framework for examining the effectiveness of immigration controls, internal enforcement measures and deportation policies of the host country in deterring debt-bonded migration.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0927537112001285
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    Article provided by Elsevier in its journal Labour Economics.

    Volume (Year): 21 (2013)
    Issue (Month): C ()
    Pages: 15-24

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    Handle: RePEc:eee:labeco:v:21:y:2013:i:c:p:15-24
    Contact details of provider: Web page: http://www.elsevier.com/locate/labeco

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    17. Gathmann, Christina, 2008. "Effects of enforcement on illegal markets: Evidence from migrant smuggling along the southwestern border," Journal of Public Economics, Elsevier, vol. 92(10-11), pages 1926-1941, October.
    18. Gil Epstein & Avi Weiss, 2011. "The why, when, and how of immigration amnesties," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(1), pages 285-316, January.
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