Optimal Migration Policies, Two-Sided Borders and socialWelfare in Overlapping Generations Models

After a general introduction and a literature review, in a 2-country OLG model, this thesis considers a non yet studied case where each government chooses for his country the flow of migrants that maximizes the post-migration social welfare. Since decision flows are unilateral, it naturally follows the introduction of the concept of optimal two-sided-borders. In a simple OLG model à la Galor (1986) with 2 periods, 2 countries and an exogenous labor supply, Chapter 2 examines the differences in optimal migration flows when country differs in time preferences. With or without costly borders, optimal flows that lead the economy to the Golden Rule differ, so that one country closes its borders before the other one. A world social planner would make an opposite migration policy compared with the country-specific social planner. Chapter 3 develops an OLG model where young train and get the return to education next period, adult and old endogenously work. The optimal migration rates leading to the social optimum of each country differ. These asymmetries generate incentives for illegal migration, hence wages and interest rates do not equalize in the post-migration equilibrium. Chapter 4 extends the previous by introducing a pension system. If by the law, only adults are allowed to migrate, then the receiving country want to attract more migrants than the departure country would let go. The individual choice of migration depends more on the children education than on the retirement benefit choice. This result is not in line with the existing literature. TheWelfare State is not the first reason for which migrants leave their country.