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Coyote crossings: the role of smugglers in illegal immigration and border enforcement

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Abstract
Illegal immigration and border enforcement in the United States have increased concomitantly for over thirty years. One interpretation is that U.S. border policies have been ineffective. We offer an alternative view, extending the current immigration-enforcement literature by incorporating both the practice of people smuggling and a role for non-wage income into a two-country, dynamic general equilibrium model. We state conditions under which two steady state equilibria exist: one with a low level of capital, but relatively little migration. We then analyze two shocks: a positive technology shock to smuggling services and an increase in border enforcement. In the low-capital steady state, the capital-labor ratio declines with technological progress in smuggling, while illegal immigration increases. In the high-capital steady state, a technology shock causes the capital-labor ratio to rise while the effect on migration is indeterminate. We show that an increase in border enforcement is qualitatively equivalent to a negative technology shock to smuggling. Finally, we show that a developed country would never choose small levels of border enforcement over an open border. Moreover, a high level of border enforcement is optimal only if it significantly decreases capital accumulation. In addition, we provide conditions under which an increase in smuggler technology will lead to a decline in the optimal level of enforcement.

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  • Mark G. Guzman & Joseph H. Haslag & Pia M. Orrenius, 2002. "Coyote crossings: the role of smugglers in illegal immigration and border enforcement," Working Papers 0201, Federal Reserve Bank of Dallas.
    • Handle: RePEc:fip:feddwp:0201
    Note: Published as: Guzman, Mark G., Joseph H. Haslag and Pia M. Orrenius (2008), "On the Determinants of Optimal Border Enforcement," Economic Theory 34 (2): 261-296.
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    Cited by:

    1. Saibal Kar & Hamid Beladi, 2017. "A Model of Smuggling and Trafficking of Illegal Immigrants with a Host Country Policy," Review of Development Economics, Wiley Blackwell, vol. 21(3), pages 698-712, August.
    2. Mark G. Guzman & Joseph H. Haslag & Pia M. Orrenius, 2003. "A role for government policy and sunspots in explaining endogenous fluctuations in illegal immigration," Working Papers 0305, Federal Reserve Bank of Dallas.
    3. Mark G. Guzman & Joseph H. Haslag & Pia M. Orrenius, 2004. "Accounting for fluctuations in social network usage and migration dynamics," Working Papers 0402, Federal Reserve Bank of Dallas.
    4. Kar, Saibal, 2016. "A brief review of the economics of illegal migration," MPRA Paper 103466, University Library of Munich, Germany.
    5. Carla Pederzini & B. Lindsay Lowell & Jeffrey Passel, 2008. "The demography of mexico/u.s. migration," Working Papers 0608, Universidad Iberoamericana, Department of Economics.

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    Keywords

    Emigration and immigration; Mexico;

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