Two-way Migration Between Similar Countries
We develop a model to explain two-way migration of high-skilled individuals between countries that are similar in their economic characteristics. High-skilled migration is explained by a combination of two features: In both countries workers’ abilities are private knowledge, and the production technology gives incentives to firms for hiring workers of similar ability. In the presence on migration cost, high-skilled workers self-select into the group of migrants, thereby ensuring they are hired together with other high-skilled migrants. The laissez-faire equilibrium features too much migration, explained by a negative migration externality, and as a result all individuals are worse off than in autarky. We also show that for sufficiently low levels of migration cost the optimal level of migration is strictly positive. In extensions to our basic model, we consider the presence of an internationally immobile factor and find that in this case the possibility of aggregate gains from migration in the laissez-faire equilibrium emerges. We also show that our basic results are robust with respect to small differences in countries’ technologies.
|Date of creation:|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (44) 0115 951 5620
Fax: (0115) 951 4159
Web page: http://www.nottingham.ac.uk/gep/index.aspx
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Kremer, Michael, 1993. "The O-Ring Theory of Economic Development," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 551-75, August.
- Fredrik Andersson & Monica Garcia-Perez & John Haltiwanger & Kristin McCue & Seth Sanders, 2010.
"Workplace Concentration of Immigrants,"
10-39r, Center for Economic Studies, U.S. Census Bureau, revised Nov 2011.
- Fredrik Andersson & Mónica García-Pérez & John C. Haltiwanger & Kristin McCue & Seth Sanders, 2010. "Workplace Concentration of Immigrants," NBER Working Papers 16544, National Bureau of Economic Research, Inc.
- Monica I. Garcia-Perez & Fredrik Andersson & John Haltiwanger & Fredrik Kristin McCue & Seth Sanders, 2011. "Workplace Concentration of Immigrants," Working Papers 2011-20, Saint Cloud State University, Department of Economics.
- Docquier, Frederic & Marfouk, Abdeslam, 2004. "Measuring the international mobility of skilled workers (1990-2000) : release 1.0," Policy Research Working Paper Series 3381, The World Bank.
- Mariassunta Giannetti, 2000.
"On the Mechanics of Migration Decisions; Skill Complementarities and Endogenous Price Differentials,"
Temi di discussione (Economic working papers)
366, Bank of Italy, Economic Research and International Relations Area.
- Giannetti, Mariassunta, 2003. "On the mechanics of migration decisions: skill complementarities and endogenous price differentials," Journal of Development Economics, Elsevier, vol. 71(2), pages 329-349, August.
- Giannetti, M., 2000. "On the Mechanics of Migration Decisions: Skill Complementarities and Endogenous Price Differentials," Papers 366, Banca Italia - Servizio di Studi.
- Hendricks, Lutz A., 2001.
"The Economic Performance of Immigrants: A Theory of Assortative Matching,"
Staff General Research Papers
11931, Iowa State University, Department of Economics.
- Hendricks, Lutz, 2001. "The Economic Performance of Immigrants: A Theory of Assortative Matching," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 42(2), pages 417-49, May.
When requesting a correction, please mention this item's handle: RePEc:not:notgep:11/07. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Hilary Hughes)
If references are entirely missing, you can add them using this form.