Controlling Migration in an Open Labor Market

Marcel Thum

Public Choice, 2004, vol. 119, issue 3_4, 425-443

Abstract: A direct immigration policy is no longer feasible for a single region in a common labor market. Within a political economy approach, this paper focuses on the question of whether migration can be controlled through the composition of government expenditures. Taking into account both capital and labor income, it turns out that the median voter's income is U-shaped in the number of immigrants. Therefore, the government can either provide less of the goods preferred by foreigners in order to minimize immigration or carry out an active immigration policy by shifting its expenditures towards those publicly provided goods. The paper identifies the factors that determine the government's choice between the two strategies.

Date: 2004
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