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Labor Mobility, Trade and Social Capital

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  • Schiff, Maurice

    () (World Bank)

Abstract

Labor market integration raises welfare in the absence of distortions. This paper examines labor and goods market integration in a general equilibrium model with social capital. The findings are: i) labor market integration has an ambiguous impact on welfare, and raises it if the goods produced and the labor skills are sufficiently different; ii) compared to Pareto optimum, labor mobility (social capital) is excessively large (depleted); iii) trade is superior to labor market integration if trading costs are no higher than private migration costs; otherwise the outcome is ambiguous; and iv) the creation of new institutions in response to labor market integration has an ambiguous impact on welfare.

Suggested Citation

  • Schiff, Maurice, 2004. "Labor Mobility, Trade and Social Capital," IZA Discussion Papers 1027, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp1027
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    References listed on IDEAS

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    Cited by:

    1. Marina Della Giusta & Uma Kambhampati, 2006. "Women migrant workers in the UK: social capital, well-being and integration," Journal of International Development, John Wiley & Sons, Ltd., vol. 18(6), pages 819-833.

    More about this item

    Keywords

    trade; social capital; labor market integration;

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • 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
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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