Strategic Amnesty and Credible Immigration Reform
Posted: 10 Sep 2001
Why do countries that impose employer sanctions to deter illegal entry of foreign workers nevertheless grant amnesty to illegal immigrants? This paper provides a positive theory of amnesty provision in a model where the constrained optimal immigration reform, involving the joint use of employer sanctions and border interdictions, is time-inconsistent. In particular, our framework demonstrates that host countries of immigration can enhance the credibility of their immigration reforms by "binding their own hands", and strategically grant a socially excessive amount of amnesty to illegal workers.
Keywords: Illegal immigration, amnesty
JEL Classification: F22, J68
Suggested Citation: Suggested Citation