Strategic Quotas on Foreign Investment and Migration

Posted: 6 Nov 2006

See all articles by Reza Oladi

Reza Oladi

Utah State University - College of Business - Department of Economics

Abstract

A basic two-country, single commodity model is considered to formulate the interactive and retaliative policies with regard to restrictions on foreign investment and labor migration. We model quota retaliations using the contingent threat situation. Under three different strategic environments, we characterize the stable quotas on factor movements. Among other things, we illustrate that either one of the two countries may end up with welfare loss- Ramaswami trap, a concept we introduce in this paper.

Keywords: Foreign investment, migration, labor and capital mobility, theory of social situations

JEL Classification: F21, F22, C72

Suggested Citation

Oladi, Reza, Strategic Quotas on Foreign Investment and Migration. Economic Theory, Vol. 24, pp. 289-306, 2004. Available at SSRN: https://ssrn.com/abstract=938267

Reza Oladi (Contact Author)

Utah State University - College of Business - Department of Economics ( email )

3530 Old Main Hill
Logan, UT 84322-3530
United States

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