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A Global View of Cross-Border Migration

  • di Giovanni, Julian

    ()

    (International Monetary Fund)

  • Levchenko, Andrei A.

    ()

    (University of Michigan)

  • Ortega, Francesc

    ()

    (Queens College, CUNY)

This paper evaluates the welfare impact of observed levels of migration and remittances in both origins and destinations, using a quantitative multi-sector model of the global economy calibrated to aggregate and firm-level data on 60 developed and developing countries. Our framework accounts jointly for origin and destination characteristics, as well as the inherently multi-country nature of both migration and other forms of integration, such as international trade and remittance flows. In the presence of firm heterogeneity and imperfect competition larger countries enjoy a greater number of varieties and thus higher welfare, all else equal. Because of this effect, natives in countries that received a lot of migration – such as Canada or Australia – are better off. The remaining natives in countries with large emigration flows – such as Jamaica or El Salvador – are also better off due to migration, but for a different reason: remittances. The quantitative results show that the welfare impact of observed levels of migration is substantial, at about 5 to 10% for the main receiving countries and about 10% for the main sending countries.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6584.

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Length: 49 pages
Date of creation: May 2012
Date of revision:
Publication status: published in: Journal of the European Economic Association, 2015, 13 (1), 168-202
Handle: RePEc:iza:izadps:dp6584
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