| Migration, trade and investment: complements or substitutes? (2006) | |||||||||||||||
Abstract | |||||||||||||||
| The paper examines the impact on the relationship between migration, trade and investment (MTI) of various policy changes and exogenous shocks, and provides new results. Mundell (1957) obtained substitution between migration and trade in the Heckscher-Ohlin model. On the other hand, Markusen (1983) presented several models that result in complementarity. I show that Markusen's result is not unique and that his models also result in substitution between migration and trade. Second, complementarity between trade, on the one hand, and international and internal migration as well as investment, on the other, is shown to hold under migration costs and financing constraints. Third, under financing constraints for unskilled labor, substitution (complementarity) holds between trade and skilled (unskilled) labor migration. Fourth, other exogenous shocks considered include those in trade costs, migration costs, terms of trade, uncertainty, and in several macroeconomic variables. I find that the migration-trade relationship is typically different for imports and exports, trade in goods and services, male and female labor, horizontal and vertical FDI, and for trade and migration costs. Long-term implications of policy changes and exogenous shocks are also examined. | |||||||||||||||
Details der Publikation | |||||||||||||||
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