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Redistributive Policy with Labour Mobility across Countries

  • LEITE MONTEIRO , Manuel

    (CORE, Université catholique de Louvain, B-1348 Louvain-la-Neuve, Belgium)

It is generally believed that international labour mobility lowers the level of redistribution each country wishes to undertake. This paper considers a model with two countries where each government redistributes income between two types of individuals. Using a general equilibrium model it is shown that there are situations where the level of redistribution in one of the two countries is in fact higher than in the absence of individual mobility. This higher level of redistribution is explained by the migration induced changes in the structure of the population in both countries, namely by the increase in the proportion of high income individuals in the country that may experience excessive redistribution.

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File URL: http://alfresco.uclouvain.be/alfresco/download/attach/workspace/SpacesStore/8a7c4190-1b78-47f5-93ce-e9be5622edcc/coredp_1994_70.pdf
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Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 1994070.

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Date of creation: 01 Dec 1994
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Handle: RePEc:cor:louvco:1994070
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  1. Wildasin, D.E., 1991. "Ralaxation of Barriers to factor Mobilty and Income Redistribution," Papers 92-009, Indiana - Center for Econometric Model Research.
  2. Robin W. Boadway & Frank R. Flatters, 1982. "Efficiency and Equalization Payments in a Federal System of Government: A Synthesis and Extension of Recent Results," Canadian Journal of Economics, Canadian Economics Association, vol. 15(4), pages 613-33, November.
  3. Pauly, Mark V., 1973. "Income redistribution as a local public good," Journal of Public Economics, Elsevier, vol. 2(1), pages 35-58, February.
  4. Leite-Monteiro, Manuel, 1997. "Redistributive policy with labour mobility across countries," Journal of Public Economics, Elsevier, vol. 65(2), pages 229-244, August.
  5. Wilson, John D., 1982. "Optimal linear income taxation in the presence of emigration," Journal of Public Economics, Elsevier, vol. 18(3), pages 363-379, August.
  6. Wildasin, D.E., 1992. "Income Restribution and Migration," Papers 92-003, Indiana - Center for Econometric Model Research.
  7. Christiansen, Vidar & Hagen, Kare P & Sandmo, Agnar, 1994. " The Scope for Taxation and Public Expenditure in an Open Economy," Scandinavian Journal of Economics, Wiley Blackwell, vol. 96(3), pages 289-309.
  8. Wilson, John D., 1980. "The effect of potential emigration on the optimal linear income tax," Journal of Public Economics, Elsevier, vol. 14(3), pages 339-353, December.
  9. MICHEL, Philippe & PESTIEAU, Pierre & VIDAL, Jean-Pierre, 1995. "Labor Mobility and Redistribution with Evolving Altruism : The Small Economy Case," CORE Discussion Papers 1995059, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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