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The economic analysis of international migration: a generalization.

K Wong

    The Canadian Journal of Economics. Revue Canadienne D'Economique
    |May 1, 1986
    PubMed
    Summary
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    International factor movements benefit destination countries but harm source countries. However, these welfare effects are not guaranteed if trade or factor flows are already established.

    Area of Science:

    • International Economics
    • Trade Theory
    • Welfare Economics

    Background:

    • The study examines established propositions regarding the welfare effects of international factor movements.
    • Existing theories suggest finite factor movements benefit destination countries and harm source countries, while marginal movements have no welfare impact.

    Purpose of the Study:

    • To rigorously examine and extend existing propositions on the welfare impacts of international factor movements.
    • To determine the conditions under which these propositions hold true, considering varying numbers of goods and factors.

    Main Methods:

    • Utilizes newly developed analytical techniques to assess the propositions.
    • Analyzes scenarios starting from autarky and scenarios with pre-existing trade and factor flows.
    Keywords:
    Demographic AnalysisDemographic FactorsEconomic FactorsEconomic ModelInternational MigrationMigrationModels, TheoreticalPopulationPopulation DynamicsResearch MethodologySocioeconomic FactorsWorld

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    Main Results:

    • Confirms the propositions' validity when economies begin from autarky, regardless of the number of goods and factors.
    • Demonstrates that the magnitude of welfare gains (or losses) is directly related to the volume of factor inflow (or outflow).
    • Finds that the propositions generally do not hold true when goods trade or factor flows are initially present.

    Conclusions:

    • Finite international factor movements can create winners and losers, but this is contingent on the initial state of the economy.
    • The presence of initial trade or factor flows significantly alters the welfare implications of further factor movements.
    • Policy implications suggest careful consideration of existing economic conditions before facilitating international factor movements.