Migrants being relatively low earners are net beneficiaries of the welfare state. However this paper uses a dynamic model to show that because of migrants` positive influence on the pension system which is an important pillar of any welfare state migration could be beneficial to all income (high...

We develop a simple information-based model of FDI flows. On the one hand, the abundance of intangible capital in specialized industries in the source countries, which presumably generates expertise in screening investment projects in the host countries, enhances FDI flows. On the other hand,...

Like any trade activity, migration tends to generate gains to all parties involved - the migrants as well as the native-born population. With a mal-functioning labour market, however, migration will exacerbate the imperfections in the market. Consequently, it may lead to losses to the...

The paper develops a model with ¡§lumpy¡¨ setup costs, which govern the flow of bilateral foreign direct investment (FDI). Every country is potentially both a source for FDI flows to several host countries, and a host for FDI flows from several source countries. But technologically-advanced...

We develop a framework in which the host-country productivity has a positive effect on the intensive margin (the size of FDI flows), but only an ambiguous effect on the extensive margin (the likelihood of FDI flows to occur). The source-country productivity has a negative effect on the extensive...