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Rational Migration Policy Should Tolerate Non-Zero Illegal Migration Flows: Lessons from Modelling the Market for Illegal Migration

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  • Entorf, Horst

    (Goethe University Frankfurt)

Abstract

The debate on the immigration policies in OECD countries has turned its attention towards illegal migrants. Given that migration flows are determined by immigration laws, the probability of potential detection, penalties for unauthorised migrants and their employers, and on income differences between sending and receiving countries, this paper presents a new approach to the problem of illegal migration, grounded on the economic theory of illegal behaviour. The framework considers the interaction of potential migrants, citizens, employers, and the government. After introducing the supply function of illegal migration and its determinants, the trade-off between social costs and benefits of preventing and combating illegal migration is demonstrated. This trade-off results in an optimal level of migration larger than zero. A complete "market model" of illegal migration is offered by presentation of a demand curve of illegal migration, based on the tolerance of the society towards clandestine foreigners. Equilibrium forces predict a non-zero level of illegal migration. The rule of law of our legal systems, according to which any illegal activity has to be reduced to zero, bears the danger of producing inefficient disequilibria. A reasonable policy of wanted and unwanted migration should address the question of how to allocate scarce resources. Ignoring social optima and equilibrium forces means to abandon public resources that could be used for other public assignments, such as schooling, or foreign aid, for instance, i.e., measures that could strike the problem of illegal migration at its root.

Suggested Citation

  • Entorf, Horst, 2000. "Rational Migration Policy Should Tolerate Non-Zero Illegal Migration Flows: Lessons from Modelling the Market for Illegal Migration," IZA Discussion Papers 199, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp199
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    References listed on IDEAS

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    1. Gary S. Becker, 1974. "Crime and Punishment: An Economic Approach," NBER Chapters, in: Essays in the Economics of Crime and Punishment, pages 1-54, National Bureau of Economic Research, Inc.
    2. Chisato Yoshida, 1993. "The Global Welfare of Illegal Immigration: A Note," Indian Economic Review, Department of Economics, Delhi School of Economics, vol. 28(1), pages 111-115, January.
    3. repec:ilo:ilowps:338944 is not listed on IDEAS
    4. Entorf, Horst & Spengler, Hannes, 2000. "Socioeconomic and demographic factors of crime in Germany: Evidence from panel data of the German states," International Review of Law and Economics, Elsevier, vol. 20(1), pages 75-106, March.
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    7. Djajic, Slobodan, 1997. "Illegal Immigration and Resource Allocation," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(1), pages 97-117, February.
    8. Ehrlich, Isaac, 1973. "Participation in Illegitimate Activities: A Theoretical and Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 81(3), pages 521-565, May-June.
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    Cited by:

    1. Horst Entorf & Jochen Moebert, 2004. "The demand for illegal migration and market outcomes," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 39(1), pages 7-10, January.
    2. Dibeh, Ghassan & Fakih, Ali & Marrouch, Walid, 2018. "Labor Market and Institutional Drivers of Youth Irregular Migration: Evidence from the MENA Region," IZA Discussion Papers 11903, Institute of Labor Economics (IZA).
    3. Fertig, Michael, 2002. "Evaluating Immigration Policy Potentials and Limitations," IZA Discussion Papers 437, Institute of Labor Economics (IZA).
    4. Moritz Bonn, 2013. "On the Interdependence of Illegal and Legal Immigration," MAGKS Papers on Economics 201301, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    5. Alexander Kemnitz & Karin Mayr, 2012. "Return Migration and Illegal Immigration Control," Norface Discussion Paper Series 2012040, Norface Research Programme on Migration, Department of Economics, University College London.
    6. Bchir, Mohamed Hedi, 2008. "The effect of mode 4 liberalization on illegal immigration," Economic Modelling, Elsevier, vol. 25(5), pages 1051-1063, September.
    7. Alexander Kemnitz & Karin Mayr, 2012. "Return Migration and Illegal Immigration Control," Norface Discussion Paper Series 2012040, Norface Research Programme on Migration, Department of Economics, University College London.
    8. Peter Huber, 2001. "Teilprojekt 10: Migration und Pendeln infolge der EU-Erweiterung," WIFO Studies, WIFO, number 19840, April.

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    More about this item

    Keywords

    social costs and benefits; migration policy; rational behaviour; Illegal migration;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis

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