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Migratory policy in developing countries: how to bring best people back?

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Abstract

This paper analyzes the decision of a migrant to return or stay within the framework of a signaling model with exogenous migratory costs. If employers have only imperfect information about the type of a worker and good workers migrate, bad workers might copy their strategy in order to get the same high wage as the good workers. Employers will therefore reduce the wage they pay to migrants and good workers incur a loss compared to the perfect information setup. In one hybrid equilibrium of the game, the more bad workers migrate, the higher the incentive for good workers to come back. Policy implications follow

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  • Besancenot, Damien & Vranceanu, Radu, 2008. "Migratory policy in developing countries: how to bring best people back?," ESSEC Working Papers DR 08017, ESSEC Research Center, ESSEC Business School.
  • Handle: RePEc:ebg:essewp:dr-08017
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    1. Christian Dustmann & Yoram Weiss, 2007. "Return Migration: Theory and Empirical Evidence," CReAM Discussion Paper Series 0702, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    2. Christian Dustmann & Yoram Weiss, 2007. "Return Migration: Theory and Empirical Evidence from the UK," British Journal of Industrial Relations, London School of Economics, vol. 45(2), pages 236-256, June.
    3. Augustin Coulon & Matloob Piracha, 2005. "Self-selection and the performance of return migrants: the source country perspective," Journal of Population Economics, Springer;European Society for Population Economics, vol. 18(4), pages 779-807, November.
    4. Ali Mansoor & Bryce Quillin, 2007. "Migration and Remittances : Eastern Europe and the Former Soviet Union," World Bank Publications, The World Bank, number 6920.
    5. Anna Iara, 2006. "Skill Diffusion by Temporary Migration? Returns to Western European Working Experience in the EU Accession Countries," wiiw Balkan Observatory Working Papers 69, The Vienna Institute for International Economic Studies, wiiw.
    6. Borjas, George J & Bratsberg, Bernt, 1996. "Who Leaves? The Outmigration of the Foreign-Born," The Review of Economics and Statistics, MIT Press, vol. 78(1), pages 165-176, February.
    7. Katz, Eliakim & Stark, Oded, 1987. "Migration, information and the costs and benefits of signalling," Regional Science and Urban Economics, Elsevier, vol. 17(3), pages 323-331, August.
    8. Dustmann, Christian, 2000. "Temporary Migration and Economic Assimilation," IZA Discussion Papers 186, Institute for the Study of Labor (IZA).
    9. A. D. Roy, 1951. "Some Thoughts On The Distribution Of Earnings," Oxford Economic Papers, Oxford University Press, vol. 3(2), pages 135-146.
    10. Stark, Oded, 1995. " Return and Dynamics: The Path of Labor Migration When Workers Differ in Their Skills and Information Is Asymmetric," Scandinavian Journal of Economics, Wiley Blackwell, vol. 97(1), pages 55-71, March.
    11. Alice Mesnard, 2004. "Temporary migration and capital market imperfections," Oxford Economic Papers, Oxford University Press, vol. 56(2), pages 242-262, April.
    12. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, Oxford University Press, vol. 87(3), pages 355-374.
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    Keywords

    Temporary Migration; Return Migrants; Hybrid Bayesian Equilibrium; Signalling Model;

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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