The growth and welfare effects of international mass migration

We analyze the effects of immigration quotas on growth and welfare in a North-South version of the quality ladders growth model. Quotas in the North increase the growth rate. However, they lower the static utility level and the discounted welfare of Northern workers. Also the discounted welfare of a...

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Bibliographic Details
Published in:Journal of international economics 2002, Vol.56 (1), p.177-204
Main Authors: Lundborg, Per, Segerstrom, Paul S.
Format: Article
Language:English
Subjects:
Dynamic models
Economic growth
Economics
Growth
Growth models
Growth rates
Immigration
International migration
Labour market
Migration
Noncitizens
Studies
Welfare
Welfare economics
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Summary:We analyze the effects of immigration quotas on growth and welfare in a North-South version of the quality ladders growth model. Quotas in the North increase the growth rate. However, they lower the static utility level and the discounted welfare of Northern workers. Also the discounted welfare of asset owners drops. Hence, unlike in the static migration model where the representative agent in the host country benefits from immigration, in our dynamic model, the representative agent loses despite a positive growth effect. Winners from immigration quotas are the immigrants and the remaining workers in the South.
ISSN:0022-1996
1873-0353
1873-0353
DOI:10.1016/S0022-1996(01)00105-2