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The Growth and Welfare Effects of International Mass Migration

  • Lundborg, Per

    (Trade Union Institute for Economic Research)

  • Segerstrom, Paul S.


    (Department of Economics, Michigan State University)

We analyse the effects of immigration quotas on growth and discounted welfare in a North-South version of the quality ladders growth model. Immigration quotas in the North increase the growth rate of utility for all consumers. However, they lower the static utility level and discounted welfare of Northern workers. Also the discounted welfare of asset owners drops. Hence, unlike in the static migration model where the representative agent in the host country benefits from immigration, in our dynamic migration model, the representative agent loses despite a positive growth effect of immigration. In general, the winners of a liberal immigration policy in the North are the immigrants and the remaining workers in the south.

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Paper provided by Trade Union Institute for Economic Research in its series Working Paper Series with number 146.

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Length: 31 pages
Date of creation: 29 Sep 1998
Date of revision:
Publication status: Published in Journal of International Economics, 2002, pages 177-204.
Handle: RePEc:hhs:fiefwp:0146
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  1. Findlay, Ronald, 1980. "The Terms of Trade and Equilibrium Growth in the World Economy," American Economic Review, American Economic Association, vol. 70(3), pages 291-99, June.
  2. Joseph G. Altonji & David Card, 1991. "The Effects of Immigration on the Labor Market Outcomes of Less-skilled Natives," NBER Chapters, in: Immigration, Trade, and the Labor Market, pages 201-234 National Bureau of Economic Research, Inc.
  3. repec:tpr:qjecon:v:112:y:1997:i:3:p:729-58 is not listed on IDEAS
  4. repec:tpr:qjecon:v:106:y:1991:i:2:p:557-86 is not listed on IDEAS
  5. Lant Pritchett, 1997. "Divergence, Big Time," Journal of Economic Perspectives, American Economic Association, vol. 11(3), pages 3-17, Summer.
  6. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
  7. Dolado, Juan J. & Goria, Alessandra & Ichino, Andrea, 1993. "Immigration, Human Capital and Growth in the Host Country: Evidence from Pooled Country Data," CEPR Discussion Papers 875, C.E.P.R. Discussion Papers.
  8. Grossman, G.M. & Helpman, E., 1989. "Quality Ladders And Product Cycles," Papers 39-89, Tel Aviv.
  9. Grossman, Gene M & Helpman, Elhanan, 1991. "Quality Ladders in the Theory of Growth," Review of Economic Studies, Wiley Blackwell, vol. 58(1), pages 43-61, January.
  10. repec:tpr:qjecon:v:106:y:1991:i:2:p:531-55 is not listed on IDEAS
  11. Benhabib, Jess, 1996. "On the political economy of immigration," European Economic Review, Elsevier, vol. 40(9), pages 1737-1743, December.
  12. Rivera-Batiz, Luis A. & Romer, Paul M., 1991. "International trade with endogenous technological change," European Economic Review, Elsevier, vol. 35(4), pages 971-1001, May.
  13. Segerstrom, Paul S & Anant, T C A & Dinopoulos, Elias, 1990. "A Schumpeterian Model of the Product Life Cycle," American Economic Review, American Economic Association, vol. 80(5), pages 1077-91, December.
  14. Luis A. Rivera-Batiz & Paul M. Romer, 1990. "Economic Integration and Endogenous Growth," NBER Working Papers 3528, National Bureau of Economic Research, Inc.
  15. Dinopoulos, Elias & Segerstrom, Paul, 1996. "A Schumpeterian Model of Protection and Relative Wages," Working Paper Series 471, Research Institute of Industrial Economics.
  16. Berry, R Albert & Soligo, Ronald, 1969. "Some Welfare Aspects of International Migration," Journal of Political Economy, University of Chicago Press, vol. 77(5), pages 778-94, Sept./Oct.
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