Temporary Migration Policies and Welfare of the Host and Source Countries: A Game-Theoretic Approach
University of Geneva
Michael S. Michael
University of Cyprus - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute for Economic Research)
CESifo Working Paper Series No. 2811
This paper examines the interaction between migration policies of the host and source countries in the context of a model of guest-worker migration. For the host, the objective is to provide low-cost labor for its employers while avoiding illegal immigration. It optimizes over these objectives by setting the time limit of a guest-worker permit. The source country seeks remittance flows and return migration by offering fiscal benefits to returnees. Within this framework, we solve for the Nash equilibrium values of the migration policy instruments and compare them with the ones that emerge in a cooperative setting.
Number of Pages in PDF File: 34
Keywords: temporary migration, remittances, migration policy
JEL Classification: F22working papers series
Date posted: October 19, 2009
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