Dutch Disease and The Mitigation Effect of Migration: Evidence from Canadian Provinces

in Economic Journal (2015), 152(589), 1574-1615

This paper evaluates whether immigration can mitigate the Dutch disease effects associated with booms in natural resource sectors. We derive predicted changes in the size of the non-tradable sector from a ... [more ▼]

This paper evaluates whether immigration can mitigate the Dutch disease effects associated with booms in natural resource sectors. We derive predicted changes in the size of the non-tradable sector from a small general-equilibrium model `a la Obstfeld-Rogoff. Using data for Canadian provinces, we find evidence that aggregate immigration mitigates the increase in the size of the non-tradable sector in booming regions. The mitigation effect is due mostly to interprovincial migration and temporary foreign workers. There is no evidence of such an effect for permanent international immigration. Interprovincial migration also results in a spreading effect of Dutch disease from booming to non-booming provinces. JEL Classi [less ▲]

Government Outsourcing: Public Contracting with Private Monopoly

in Economic Journal (2009), 119

The article studies the impact of the government budget constraint on the regulation of natural monopolies in adverse selection contexts. The government maximises total surplus but incurs some cost of ... [more ▼]

The article studies the impact of the government budget constraint on the regulation of natural monopolies in adverse selection contexts. The government maximises total surplus but incurs some cost of public funds "à la" Laffont and Tirole (1993). Government outsourcing is proposed as an alternative to regulation in which firms freely enter the market and choose their prices and output levels. However the government can contract "ex post" with the private firms. This "ex post" contracting set-up allows more flexibility than regulation where governments commit to both investment and operation cash-flows. This is especially relevant in case of high technological uncertainties. Copyright � The Author(s). Journal compilation � Royal Economic Society 2009. [less ▲]

Brain Drain and LDC's Growth: winners and losers

in Economic Journal (2007), 118

We present an empirical evaluation of the growth effects of the brain drain for the source countries of migrants. Using recent US data on migration rates by education levels (Carrington and Detragiache ... [more ▼]

We present an empirical evaluation of the growth effects of the brain drain for the source countries of migrants. Using recent US data on migration rates by education levels (Carrington and Detragiache, 1998), we find empirical support for the "beneficial brain drain hypothesis" in a cross-section of 50 developing countries. At the country-level, we find that most countries combining low levels of human capital and low migration rates of skilled workers tend to be positively affected by the brain drain. By contrast, the brain drain appears to have negative growth effects in countries where the migration rate of the highly educated is above 20% and/or where the proportion of people with higher education is above 5%. While the number of winners is smaller, these include nearly 80% of the total population of the sample. [less ▲]