Undocumented migrants in debt

Slobodan Djajić and Alexandra Vinogradova

Labour Economics, 2013, vol. 21, issue C, 15-24

Abstract: Numerous studies suggest that illegal immigration in the form of bonded labor is becoming an increasingly important phenomenon. This paper develops a model of optimizing behavior of undocumented immigrants who are employed in the host country as bonded laborers while repaying their debts to human smugglers. The analysis relates the optimal duration of the repayment period and the migrant's consumption path to the stock of debt, the rate of interest charged by the smuggler and the levels of the bonded and free-market wages in the destination country. This provides a framework for examining the effectiveness of immigration controls, internal enforcement measures and deportation policies of the host country in deterring debt-bonded migration.

Keywords: Illegal immigration; Bonded labor; Human smuggling (search for similar items in EconPapers)
JEL-codes: F22 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:labeco:v:21:y:2013:i:c:p:15-24

DOI: 10.1016/j.labeco.2012.12.004

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