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Illegal Migration, Enforcement and Minimum Wage

  • Epstein, Gil S.


    (Bar-Ilan University)

  • Heizler (Cohen), Odelia


    (Academic College of Tel-Aviv Yaffo)

This paper examines the connection between illegal migration, minimum wages and enforcement policy. We first explore the employers’ decision regarding the employment of illegal migrants in the presence of an effective minimum wage. We show that the employers’ decision depends on the wage gap between those of the legal and illegal workers and on the penalty for employing illegal workers. We consider the effects a change in the minimum wage has on the employment of illegal immigrants and local workers. We conclude by considering the optimal migration policy taking into consideration social welfare issues.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2830.

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Length: 31 pages
Date of creation: Jun 2007
Date of revision:
Publication status: published in: Research in Labor Economics, 2008, 28, 197-224
Handle: RePEc:iza:izadps:dp2830
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  1. Epstein, Gil S. & Hillman, Arye L., 2003. "Unemployed immigrants and voter sentiment in the welfare state," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1641-1655, August.
  2. Gordon H. Hanson & Antonio Spilimbergo, 1996. "Illegal Immigration, Border Enforcement, and Relative Wages: Evidence from Apprehensions at the U.S.-Mexico Border," Research Department Publications 4036, Inter-American Development Bank, Research Department.
  3. Benhabib, Jess, 1996. "On the political economy of immigration," European Economic Review, Elsevier, vol. 40(9), pages 1737-1743, December.
  4. Barry Chiswick, 1999. "Are Immigrants Favorably Self-Selected?," American Economic Review, American Economic Association, vol. 89(2), pages 181-185, May.
  5. Jean-Marie Grether & Jaime de Melo & Tobias Müller, 2015. "The Political Economy of International Migration in a Ricardo–Viner Model," World Scientific Book Chapters, in: Developing Countries in the World Economy, chapter 17, pages 411-437 World Scientific Publishing Co. Pte. Ltd..
  6. Bauer, Thomas K. & Lofstrom, Magnus & Zimmermann, Klaus F., 2000. "Immigration Policy, Assimilation of Immigrants and Natives' Sentiments towards Immigrants: Evidence from 12 OECD-Countries," IZA Discussion Papers 187, Institute for the Study of Labor (IZA).
  7. ?gel Solano Garc?, 2004. "Does illegal immigration empower rightist parties?," UFAE and IAE Working Papers 614.04, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  8. Mark Guzman & Joseph Haslag & Pia Orrenius, 2008. "On the determinants of optimal border enforcement," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 34(2), pages 261-296, February.
  9. Richard Dickens & Stephen Machin & Alan Manning, 1994. "The Effects of Minimum Wages on Employment: Theory and Evidence from Britain," CEP Discussion Papers dp0183, Centre for Economic Performance, LSE.
  10. Avi Weiss & Arye L. Hillman & Gil S. Epstein, 1999. "Creating illegal immigrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 12(1), pages 3-21.
  11. Gaytan-Fregoso, Helena & Lahiri, Sajal, 2000. "Foreign aid and illegal immigration," Journal of Development Economics, Elsevier, vol. 63(2), pages 515-527, December.
  12. Slobodan Djajic, 1999. "Dynamics of immigration control," Journal of Population Economics, Springer;European Society for Population Economics, vol. 12(1), pages 45-61.
  13. Gil Epstein & Avi Weiss, 2011. "The why, when, and how of immigration amnesties," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(1), pages 285-316, January.
  14. Epstein, Gil S. & Nitzan, Shmuel, 2005. "The Struggle over Migration Policy," IZA Discussion Papers 1533, Institute for the Study of Labor (IZA).
  15. Yaniv, Gideon, 2001. "Minimum Wage Noncompliance and the Employment Decision," Journal of Labor Economics, University of Chicago Press, vol. 19(3), pages 596-603, July.
  16. Klaus F. Zimmermann, 1995. "Tackling the European Migration Problems," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 45-62, Spring.
  17. Ethier, Wilfred J, 1986. "Illegal Immigration: The Host-Country Problem," American Economic Review, American Economic Association, vol. 76(1), pages 56-71, March.
  18. 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.
  19. J. Amegashie, 2004. "A political economy model of immigration quotas," Economics of Governance, Springer, vol. 5(3), pages 255-267, November.
  20. Cobb-Clark, Deborah A & Shiells, Clinton R & Lowell, B Lindsay, 1995. "Immigration Reform: The Effects of Employer Sanctions and Legalization on Wages," Journal of Labor Economics, University of Chicago Press, vol. 13(3), pages 472-98, July.
  21. Chiswick, Barry R, 1988. "Illegal Immigration and Immigration Control," Journal of Economic Perspectives, American Economic Association, vol. 2(3), pages 101-15, Summer.
  22. George J. Borjas, 1995. "The Economic Benefits from Immigration," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 3-22, Spring.
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