Three essays on the theory of international labor migration

The first essay examines the effects of labor immigration on domestic wage rates and labor supply in a dynamic, general equilibrium framework. The general equilibrium model makes it possible to endogenize the pattern of labor migration, and the effect of labor migration on domestic wage rates and labor supply is shown to depend on this pattern. If the substitution effect dominates the income effect in labor supply, the domestic supply of labor necessarily decreases following immigration. This happens even if immigrants, through their savings behavior, cause an increase in the domestic capital-labor ratio and wage rate. Similarly, if the dominant effect is the income effect, labor migration necessarily increases the domestic supply of labor.;The second essay considers some policies that a country may use to reduce the burden of limiting immigration in the context of a one-good model with two countries possessing different technologies. The labor receiving country is assumed to "bribe" the source country so that the latter may assume the burden of controlling emigration. In one case, the source country is allowed to set optimal policies with respect to factor flows. In contrast to the Ramaswami proposition, it is shown that this country may still prefer an optimal outflow of its abundant factor, labor. Also, it is shown that the source country may even prefer a labor outflow to a gift of superior technology. Thus, there may exist no "bribe" which the host country can offer the other country. It must police its own borders.;The third essay considers labor migration under conditions of imperfect information and signalling in labor markets. Labor is allowed to be heterogeneous in terms of skills. The focus of the essay is on delineating the conditions under which migrant workers will consist of only the high skilled, the low skilled or both. In one case, it is shown that the migration of the highest skilled workers may even be a pre-condition for migration to occur. Signalling by means of acquiring an education has little or no effect on the extent of migration.