Labour migration in a model of North-South trade

A dynamic general eqilibrium model of the world economy is adopted to examine the benefits and drawbacks of labour migration to each of the participatingregions. It is demonstrated that, especially in the long term, the migration of workers may be mutually beneficial: the region of immigration making production gains, while that of emigration perceives a higher demand for its products. In contrast to previous results, it is shown that no immigration limits would be imposed even if migrants' incomes were taxed and, indeed, differentiated payments to immigrants is suboptimal