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Wage Effects of Labour Migration with International Capital Mobility

Journal article
Authors Joakim Ruist
Arne Bigsten
Published in World Economy
Volume 36
Issue 1
Pages 31-47
ISSN 0378-5920
Publication year 2013
Published at Gothenburg Centre for Globalization and Development (GCGD)
Department of Economics
Pages 31-47
Language en
Links dx.doi.org/10.1111/twec.12006
Keywords global restrictions, immigration, efficiency, gains
Subject categories Economics

Abstract

Wage effects of immigration are investigated in a setting with international capital mobility, which eliminates two-thirds of the native wage effects of immigration. Without international capital mobility, overall gains from migration in the immigration region are only a small fraction of total losses to native workers, but with perfect international capital adjustment, overall gains are larger than total losses to native workers. Two alternative tax policies to eliminate the negative wage effects of immigration on low-skilled native workers are evaluated.

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