The native-born young, whether skilled or unskilled, benefit from letting in migrants of all skill types, because their high birth rates can help increase the tax base in the next period. In this respect, skilled migrants help the welfare state more than unskilled migrants, to the extent that...

The paper provides a reconciliation of Lucas' paradox, based on fixed setup costs of new investments. With such costs, it does not pay a firm to make a "small" investment, even though such an investment is called for by marginal productivity conditions. Using a sample of 45 developed and...

Foreign direct investors are more informed than foreign portfolio investors regarding changes in the prospects of their projects. This inside information, acquired through rigorous monitoring of management, enables foreign direct investors to manage their firms more efficiently. Having better...

The last few years have been characterized by great turmoil in the world’s financial markets; starting from the collapse of housing prices in the US, followed by the meltdown of leading financial institutions in the US and Europe, and then the ongoing challenge to the European monetary...

relative to the free migration regime.

immigration helps sustain the social security.

The paper revisit the issue of whether tax competition is a race to the bottom. I analyze tax competion among a continuum of competing host countries facing an upward†sloping supply of would be igrants. Capital move freely across the host country economies. I show how the fiscal burden of...

In the political debate people express the idea that immigrants are good because they can help pay for the old. The paper explores this idea in a dynamic political-economy setup. For this purpose we develop an OLG political economy model of social security and migration. We characterize sub-game...