Immigration Control and the Welfare State
We examine immigratuon policy and its redistributive effects using a model of a rich country which must spend on border control in order to regulate immigration from a poor country. There are owners and workers in the rich country, and a public sector which makes redistributive transfers from owners to workers. We first consider the case where illegal immigrants have access to the public sector, a situation currently observed in many countries. We show that as border control becomes more expensive inequality in the rich country increases, redistributive transfers may increase or decrease, some immigration is permitted and foreign aid may be used by the rich country in order to reduce the migration pressure along its border with the poor country. Because of nonconvexities, we also show a small decrease in the aversion to collapse of the redistributive public sector. We then consider excluding illegal immigrants from the public sector (eg. Califronia Proposition 187). We find that the possibility of collapse vanishes and that the rich country takes the toughest official stance on migration but does not enforce it with border controls.
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References listed on IDEAS
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- Djajic, Slobodan, 1987. "Illegal aliens, unemployment and immigration policy," Journal of Development Economics, Elsevier, vol. 25(1), pages 235-249, February.
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- David E. Wildasin, 1994. "Income Redistribution and Migration," Canadian Journal of Economics, Canadian Economics Association, vol. 27(3), pages 637-656, August.
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- Bond, Eric W. & Chen, Tain-Jy, 1987. "The welfare effects of illegal immigration," Journal of International Economics, Elsevier, vol. 23(3-4), pages 315-328, November.
- Wellisch, Dietmar & Wildasin, David E., 1996. "Decentralized income redistribution and immigration," European Economic Review, Elsevier, vol. 40(1), pages 187-217, January. Full references (including those not matched with items on IDEAS)