We examine a model of a rich country with a redistributive public sector and facing costly immigration control. When illegal immigrants have access to the public sector we show that, as border control becomes more expensive, inequality in the rich country increases, redistributive transfers...

We analyze some macroeconomic implications that follow from the fact that people tend to consume higher-quality goods as their incomes rise. The model involves two sectors: one producing a homogeneous good and the other producing a product with variable levels of quality. Both sectors use...