Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/126641
Authors: 
Camacho, Carmen
Mariani, Fabio
Pensieroso, Luca
Year of Publication: 
2015
Series/Report no.: 
IZA Discussion Papers 9545
Abstract: 
We build a general equilibrium model in which both illegal immigration and the size of the informal sector are endogenously determined. In this framework, we show that indirect policy measures such as tax reduction and detection of informal activities can be used as substitutes for border enforcement, in order to contrast illegal immigration. We also find that a welfare-maximising Government that includes illegal immigration in its objective function, instead of focusing on the well-being of native workers only, will set the tax rate to a lower value.
Subjects: 
illegal immigration
informal sector
shadow economy
taxation
immigration policy
JEL: 
O17
F22
J61
Document Type: 
Working Paper

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