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The effect of income and immigration policies on international migration

In: The Economics of International Migration

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  • Francesc Ortega
  • Giovanni Peri

Abstract

This article makes two contributions to the literature on the determinants of international migration flows. First, we compile a new dataset on annual bilateral migration flows covering 15 OECD destination countries and 120 sending countries for the period 1980–2006. The dataset also contains data on time-varying immigration policies that regulate the entry of immigrants in our destination countries over this period. Second, we present an empirical model of migration choice across multiple destinations that allows for unobserved individual heterogeneity and derive a structural estimating equation. Our estimates show that international migration flows are highly responsive to income per capita at destination. This elasticity is twice as high for within-European Union (EU) migration, reflecting the higher degree of labor mobility within the EU. We also find that tightening of laws regulating immigrant entry reduce rapidly and significantly their flow.

Suggested Citation

  • Francesc Ortega & Giovanni Peri, 2016. "The effect of income and immigration policies on international migration," World Scientific Book Chapters, in: The Economics of International Migration, chapter 11, pages 333-360, World Scientific Publishing Co. Pte. Ltd..
    • Handle: RePEc:wsi:wschap:9789814719902_0011
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    Cited by:

    1. Cattaneo, Cristina & Peri, Giovanni, 2016. "The migration response to increasing temperatures," Journal of Development Economics, Elsevier, vol. 122(C), pages 127-146.
    2. Hubert Jayet & Glenn Rayp & Ilse Ruyssen & Nadiya Ukrayinchuk, 2016. "Immigrants’ location choice in Belgium," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 57(1), pages 63-89, July.
    3. Gabriel Loumeau, 2020. "Regional Borders, Commuting and Transport Network Integration," KOF Working papers 20-489, KOF Swiss Economic Institute, ETH Zurich.
    4. Mattia Makovec & Ririn S Purnamasari & Matteo Sandi & Astrid R Savitri, 2018. "Intended versus unintended consequences of migration restriction policies: evidence from a natural experiment in Indonesia," Journal of Economic Geography, Oxford University Press, vol. 18(4), pages 915-950.
    5. Sanchis-Guarner, Rosa, 2023. "Decomposing the impact of immigration on house prices," Regional Science and Urban Economics, Elsevier, vol. 100(C).
    6. Artuc, Erhan & Docquier, Frédéric & Özden, Çaglar & Parsons, Christopher, 2015. "A Global Assessment of Human Capital Mobility: The Role of Non-OECD Destinations," World Development, Elsevier, vol. 65(C), pages 6-26.
    7. Ferrie, Joseph & Hatton, Timothy J., 2013. "Two Centuries of International Migration," IZA Discussion Papers 7866, Institute of Labor Economics (IZA).
    8. Giang Ho & Ms. Kazuko Shirono, 2015. "The Nordic Labor Market and Migration," IMF Working Papers 2015/254, International Monetary Fund.
    9. Hatton, Timothy J., 2014. "The economics of international migration: A short history of the debate," Labour Economics, Elsevier, vol. 30(C), pages 43-50.
    10. Jiří Balcar & Jan Šulák, 2021. "Urban environmental quality and out-migration intentions," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 66(3), pages 579-607, June.
    11. Egger, Peter H. & Loumeau, Gabriel & Loumeau, Nicole, 2023. "China's dazzling transport-infrastructure growth: Measurement and effects," Journal of International Economics, Elsevier, vol. 142(C).
    12. Patrice Pieretti & Giuseppe Pulina & Skerdilajda Zanaj, 2024. "Fiscal competition and two-way migration," BCL working papers 183, Central Bank of Luxembourg.
    13. Protte, Benjamin, 2012. "How does Economic Integration Change Personal Income Taxation? Evidence from a new Index of Potential Labor Mobility," Working Papers 12-20, University of Mannheim, Department of Economics.
    14. Rosa Sanchis-Guarner, 2014. "First-Come First-Served: Identifying the Demand Effect of Immigration Inflows on House Prices," SERC Discussion Papers 0160, Centre for Economic Performance, LSE.
    15. de la Rica, Sara & Glitz, Albrecht & Ortega, Francesc, 2013. "Immigration in Europe: Trends, Policies and Empirical Evidence," IZA Discussion Papers 7778, Institute of Labor Economics (IZA).
    16. Patrice Pieretti & Giuseppe Pulina & Andreas Sintos & Skerdilajda Zanaj, 2024. "Fiscal Competition and Migration Patterns," DEM Discussion Paper Series 24-04, Department of Economics at the University of Luxembourg.
    17. Eran Yashiv, 2021. "Moving from a Poor Economy to a Rich One: A Job Tasks Approach," RF Berlin - CReAM Discussion Paper Series 2119, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    18. Yashiv, Eran, 2021. "Moving from a poor economy to a rich one: A job tasks approach," Labour Economics, Elsevier, vol. 72(C).
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    More about this item

    Keywords

    Migration; Immigration; Growth; Productivity; Labor Markets; Selection; Immigration Policies;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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