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A Market for Work Permits

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  • Michael Lokshin
  • Martin Ravallion

Abstract

It will be politically difficult to liberalize international migration without protecting host-country workers. The paper explores the scope for efficiently managing migration using a competitive market for work permits. Host-county workers would have the option of renting out their citizenship work permit for a period of their choice, while foreigners purchase time-bound work permits. Aggregate labor supply need not rise in the host country. However, total output would rise and workers would see enhanced social protection. Simulations for the US and Mexico suggest that the new market would attract many skilled migrants, boosting GDP and reducing poverty in the US.

Suggested Citation

  • Michael Lokshin & Martin Ravallion, 2019. "A Market for Work Permits," NBER Working Papers 26590, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:26590
    Note: DEV LS
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    References listed on IDEAS

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    1. Fan, C. Simon & Stark, Oded, 2007. "International migration and "educated unemployment"," Journal of Development Economics, Elsevier, vol. 83(1), pages 76-87, May.
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    More about this item

    JEL classification:

    • 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

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