The simple analytics of optimal growth with illegal migrants: A clarification

This paper reexamines the welfare effects of illegal immigration studied by Hazari and Sgro [The simple analytics of optimal growth with illegal migrants. Journal of Economic Dynamics and Control 28(1) 141–151]. In contrast to their negative conclusion, we obtain ambiguous welfare prediction which is due to the presence of two opposing effects at work: a positive exploitation effect and a negative intertemporal effect. With Cobb–Douglas production technology, we show that per capita domestic consumption rises in the presence of illegal migration.