Immigration from a terror-prone nation: Destination nation's optimal immigration and counterterrorism policies

Subhayu Bandyopadhyay, Khusrav Gaibulloev and Todd Sandler

Economic Modelling, 2025, vol. 143, issue C

Abstract: The article presents a two-country model in which a destination country chooses its immigration quota and proactive counterterrorism measures in response to immigration from a terror-plagued country. A novel feature is to tie the optimizing quota and proactive choice to the consequences on the labor market. After the destination country fixes its two policies, immigrants decide between supplying labor or conducting terrorist attacks, which helps to determine equilibrium labor supply and wages. The analysis accounts for the marginal disutility of lost rights/freedoms stemming from stricter counterterror measures as well as the inherent radicalization of migrants. Comparative statics involve changes to those two parameters. For example, an enhanced importance attached to lost rights is shown to limit immigration quotas and counterterrorism actions. In contrast, increased source-country radicalization reduces immigration quotas but has an ambiguous effect on optimal proactive measures. Extensions involve defensive policies and destination-country citizens’ radicalization.

Keywords: Immigration from a terror-prone country; Interplay between immigration quotas and proactive counterterrorism; Counterterrorism influence on rights/freedoms; Source-country radicalization; Labor-market equilibrium (search for similar items in EconPapers)
JEL-codes: F22 H56 H87 (search for similar items in EconPapers)
Date: 2025
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Working Paper: Immigration from a terror-prone nation: destination nation’s optimal immigration and counterterrorism policies (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:143:y:2025:i:c:s0264999324003298

DOI: 10.1016/j.econmod.2024.106972

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