Migration and trade with external economies of scale
The analysis of migration in Findlay (1982) is extended by adding external economies of scale to the Ricardian model as in Ethier (1982). With external economies, the larger country always gains from trade but the smaller country may lose from trade unless the external economies of scale are sufficiently strong. The smaller country will always gain from emigration but the larger country may lose from immigration unless the external economies of scale are sufficiently strong. Both countries gain from complete economic integration (free labour migration with free trade). Finally, the optimal migration policies of the two countries are derived.
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- Ethier, Wilfred J, 1982. "Decreasing Costs in International Trade and Frank Graham's Argument for Protection," Econometrica, Econometric Society, vol. 50(5), pages 1243-68, September.
- Richard B. Freeman, 2006.
"People Flows in Globalization,"
NBER Working Papers
12315, National Bureau of Economic Research, Inc.
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- Panagariya, Arvind, 1981. "Variable Returns to Scale in Production and Patterns of Specialization," American Economic Review, American Economic Association, vol. 71(1), pages 221-30, March.
- Grossman, Gene M., 1984. "The gains from international factor movements," Journal of International Economics, Elsevier, vol. 17(1-2), pages 73-83, August.
- George J. Borjas, 1994.
"The Economic Benefits from Immigration,"
NBER Working Papers
4955, National Bureau of Economic Research, Inc.
- Findlay, Ronald, 1982. "International distributive justice : A trade theoretic approach," Journal of International Economics, Elsevier, vol. 13(1-2), pages 1-14, August.
- Donald R. Davis & David E. Weinstein, 2002. "Technological Superiority and the Losses from Migration," NBER Working Papers 8971, National Bureau of Economic Research, Inc.
- Jagdish Bhagwati, 1958. "Immiserizing Growth: A Geometrical Note," Review of Economic Studies, Oxford University Press, vol. 25(3), pages 201-205.
- Frank D. Graham, 1923. "Some Aspects of Protection Further Considered," The Quarterly Journal of Economics, Oxford University Press, vol. 37(2), pages 199-227.
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