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A welfare comparison between trade and migration: Local public goods, redistributive policies, and housing markets

GoTriple's project summary

The research project has as general objective to provide further insights to the welfare comparation between trade in goods and migration. A complementary objective is to provide an adequate framework for the discussion of migration policies.There are three issues related to migration flows that are important from a practical point of view and are the object of this research project: The effects of migrants on the cost of providing public goods, the effects of migrants on welfare of local labour force, and the effects of migrants on housing markets. The project aims to build general enough models to analyze the welfare consequences of free mobility of persons within countries when there are public goods that can be congested, to design policies to regulate international migration, and to propose realistic policies to compensate deserving losers from migration flows (some of them based on housing markets).More specifically, the project plans to construct a model with local public goods and congestion levels endogenously determined and, for such a model, define and explore the welfare characteristics of the competitive equilibrium for different forms of financing public goods and find conditions for obtaining gains from migration. On the other hand, the project wants to analyze non linear second best redistributive policies that make Pareto gains from migration attainable. Finally, the project aims to introduce explicitly housing markets in a General Equilibrium model and analyze how housing price equilibrium vary when migration is freed, and how tax policies based on housing market prices can act a regulatory migration device and as a compensation device of possible losers with migration.

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