Assimilation of Immigrants: Implications for Human Capital Accumulation of the Second Generation

Immigrants assimilate in various dimensions at different rates. Moreover, in each of these dimensions they assimilate at rates that may differ from those of their children. The purpose of this paper is to examine how the pace of assimilation of immigrants in various dimensions affects the rate of human capital accumulation of immigrant children. It is argued that rapid assimilation in certain dimensions serves to increase the rate of human capital accumulation of the second generation, while in other dimensions it may have the opposite effect.Assimilation; Immigrants; Human Capital.

Investment Opportunities in the Source Country and Temporary Migration

This paper examines how attractive investment opportunities available to temporary migrants in their country of origin a¤ect their saving behavior and the optimal duration of stay abroad. The model predicts an inverse U-shaped relationship between migration duration and the expected rate of return on repatriated savings. A higher rate provides an incentive to go back earlier and consume less abroad, while it can also trigger emigration aimed at generating the savings required for investment after return. At a more general level, the paper illustrates how the behavior of temporary migrants re?ects the interaction between their preferences and the opportunities available in the labor and capital markets of both countries.International migration, Remittances, Return migration

Foreign Aid, Infrastructure Development, and Welfare: An Intertemporal Analysis

This paper examines the welfare implications of foreign aid within the framework of a two-period, two-country model of international trade. It is up to the donor country to decide what fraction of any given aid package is to be made available for the recipient?s immediate, period-one consumption, and what part should be allocated for investment in infrastructure that expands the recipient?s production possibilities in period two. The focus of the analysis is on the conditions under which both countries agree or disagree on the manner in which the aid funds should be divided between the two options.foreign aid, trade, model, welfare

Guest Worker Programs: A Theoretical Analysis of Welfare of the Host and Source Countries

This paper examines the interaction between migration policies of the host and source countries in the context of a model of guest-worker migration. For the host, the objective is to provide low-cost labor for its employers while avoiding illegal immigration. It optimizes over these objectives by setting the time limit of a guest-worker permit. The source country seeks remittance flows and return migration by offering fiscal benefits to returnees. Within this framework, we solve for the Nash equilibrium values of the migration policy instruments and compare them, to the extent possible, with the ones that emerge in a cooperative setting.Temporary Migration, Remittances, Migration Policy

Logic of aid in an intertemporal setting

This paper studies the welfare implications of temporary foreign aid in the context of a simple two-country model of trade. In addition to its usual effects, a transfer of income in one period is assumed to influence the preferences of the recipient country in the following period. The implied changes in the terms of trade over the two periods are consistent with a number of possible outcomes with respect to the intertemporal welfare of the donor, the recipient, and the world as a whole. Particular attention is devoted to the conditions for strict Pareto improvement and the circumstances under which temporary aid transactions are likely to occur.Foreign aid; terms of trade; international transfers; intertemporal model

Nonsterilized intervention and the floating exchange rate

SIGLEAvailable from Bibliothek des Instituts fuer Weltwirtschaft, ZBW, Duesternbrook Weg 120, D-24105 Kiel / FIZ - Fachinformationszzentrum Karlsruhe / TIB - Technische InformationsbibliothekDEGerman

Effects of Budgetary Policies in Open Economies : The Role of Intertemporal Consumption Substitution

An economy's optimal response to temporary and anticipated future changes in government spending is examined in the context of a two-country model which highlights the role of the elasticity of intertemporal consumption substituion (ICS). Soecial attention is devoted to the case in which both governments pursue identical policy measures. The qualitative effects of such measures on an economy's current account, its terms of trade (in a two-commodity world), and its real exchange and interest rate (in a world with non-traded goods) are shown to depend on the relationship between the domestic and the foreign elasticity of ICS.Published in connection with a visit at the IIES

Dynamics of immigration control

This paper examines the dynamic implications of border control policies and internal enforcement measures for the pattern of illegal immigration and the sectoral allocation of clandestine foreign workers. It is argued that efforts to control illegal immigration in sectors where they traditionally find employment may trigger the formation of networks supporting clandestine foreign workers in new locations and occupations where the probability of detection is relatively lower. The end result may be an increase in the overall stock of illegal immigrants residing in the economy.Illegal immigration · networks

Intermediate Inputs and International Trade: An Analysis of the Real and Monetary Aspects of an Oil Price Shock

This paper analyses the real and monetary effects of an increase in the price of a traded intermediate input. On the production side, the model differs from other work on the subject in that our economy produces the intermediate input and also traded and non-traded final goods. On the asset side, titles representing ownership of the specific factor which is used in the production of the intermediate input, are explicitly introduced into portfolios. The analysis mainly focuses on the effects of an increase in the price of the intermediate input on the distribution of income, relative prices, production levels, the balance of trade and the level of, as well as the rates of change in, nominal prices and the exchange rate