Migrant smuggling when exploitation is private information

This study contributes to the small theoretical literature on human smuggling by assuming for the first time asymmetric information in analysis. The assumption raises the possibility of an adverse selection equilibrium where only exploitative smugglers are employed at a low fee even though migrants are willing to pay nonexploitative smugglers a high fee. More importantly, I find that improved inland apprehension of migrants may increase the incidence of migrant exploitation while failing to decrease smuggling attempts. Furthermore, improved border apprehension of migrants and smugglers may not affect the market at all.