Centre for Development Economics
and
Department of Economics, Delhi School of Economics

ANNOUNCE A SEMINAR

Workers Without Borders?
Culture and the Political Economy of
Temporary versus Permanent Immigration

by

Sanjay Jain

Cambridge University

Monday, 15th April 2013 at 3:00 PM

Venue : Seminar Room (First Floor)
Department of Economics, Delhi School of Economics

All are cordially invited

Abstract

This paper examines the role of cultural factors in driving the politics, size and nature (temporary versus permanent migration) of migration policy. We demonstrate that there exists a broad political failure that results in inefficiently high barriers restricting the import of temporary foreign workers, while admitting an inefficiently large number of permanent migrants, to fill a labor shortage.  Strikingly, we show that countries that are poor at cultural assimilation may be better positioned to take advantage of temporary foreign worker programs than more culturally diverse and tolerant countries. In some circumstances, relaxing restrictions on the mobility of temporary migrant workers across employers has the potential to raise host country welfare, even though it increases migrant wages and lowers individual firms’ profits.  We also demonstrate the existence of multiple equilibria: some countries have mostly temporary migration programs and see a low degree of cultural assimilation by migrants, while other countries rely more on permanent migrants and see much more assimilation.

 

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