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Research Topics

Microeconomics


Illegal Immigration, Border Enforcement, and Relative Wages: Evidence from Apprehensions at the U.S.-Mexico Border
Spilimbergo, Antonio; Hanson, Gordon H.
Working Papers - English - Sep, 1996

This paper examines the determinants of illegal immigration in the United States from Mexico from 1976 to 1995. The main challenge in the empirical work is that the observations are not the number of individuals that attempt to enter the United States illegally, but rather the number of individuals apprehended attempting to cross the U.S.-Mexico border illegally. Based on a simple model of the individual migration decision, we postulate the existence of an apprehensions function, which expresses the number of apprehensions at the U.S.-Mexico border as a function of the number of illegal attempts to cross the border an the level of border-enforcement effort exerted by the U.S. government.


Why Low Inequality Spurs Growth: Savings and Investment by the Poor
Birdsall, Nancy; Sabot, Richard H.; Pinckney, Thomas C.
Working Papers - English - Aug, 1996

New empirical evidence suggests that high levels of income inequality constrain rather than encourage growth. While some explanations involve relationships between inequality and political systems, this paper focuses on the microeconomic behavior of poor households. When returns to labor are sufficiently high, poor households can intensify their work effort to generate additional income that in turn provides funds for high-return investments; under these circumstances the marginal propensity to save from this additional income may be exceptionally high. Increased savings and investment among the poor can, in turn, simultaneously reduce poverty and income inequality and stimulate growth. The model developed in this paper is applied to human capital investment in Brazil and Korea from 1960 to 1990.


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