Migration and FDI: Reconciling the standard ...
Document type :
Compte-rendu et recension critique d'ouvrage
Title :
Migration and FDI: Reconciling the standard trade theory with empirical evidence
Author(s) :
Jayet, Hubert [Auteur]
Lille économie management - UMR 9221 [LEM]
Marchal, Léa [Auteur]
Institut de Biologie du Développement de Marseille [IBDM]
Lille économie management - UMR 9221 [LEM]
Marchal, Léa [Auteur]
Institut de Biologie du Développement de Marseille [IBDM]
Journal title :
Economic Modelling
Pages :
46--66
Publisher :
Elsevier
Publication date :
2016-12
ISSN :
0264-9993
English keyword(s) :
Capital flows
Migration
Skills
Standard trade theory
Migration
Skills
Standard trade theory
HAL domain(s) :
Sciences de l'Homme et Société/Economies et finances
English abstract : [en]
This article focuses on an apparent conflict between the standard trade theory and available empirical evidence on factor flows. Theoretically, labor and capital flows must be substitutes. However, empirical papers find ...
Show more >This article focuses on an apparent conflict between the standard trade theory and available empirical evidence on factor flows. Theoretically, labor and capital flows must be substitutes. However, empirical papers find migration and FDI to be either substitutes or complements, depending upon the skill content of migration. To reconcile the standard theory with these empirical results, we develop a two-country general equilibrium model. We consider three factors – capital, unskilled and skilled labor – and two internationally traded goods. Countries only differ in their factor endowments. The first country is a developing country amply endowed with unskilled labor; the second one is a developed country well endowed with skilled labor. Under imperfect factor mobility, we find that capital and unskilled labor flows are substitutes, while capital and skilled labor flows are complements.Show less >
Show more >This article focuses on an apparent conflict between the standard trade theory and available empirical evidence on factor flows. Theoretically, labor and capital flows must be substitutes. However, empirical papers find migration and FDI to be either substitutes or complements, depending upon the skill content of migration. To reconcile the standard theory with these empirical results, we develop a two-country general equilibrium model. We consider three factors – capital, unskilled and skilled labor – and two internationally traded goods. Countries only differ in their factor endowments. The first country is a developing country amply endowed with unskilled labor; the second one is a developed country well endowed with skilled labor. Under imperfect factor mobility, we find that capital and unskilled labor flows are substitutes, while capital and skilled labor flows are complements.Show less >
Language :
Anglais
Popular science :
Non
Collections :
Source :
Files
- https://www.econstor.eu/bitstream/10419/140903/1/859630714.pdf
- Open access
- Access the document
- https://www.econstor.eu/bitstream/10419/140903/1/859630714.pdf
- Open access
- Access the document