Léa Marchal, Claire Naiditch May 31, 2016
Abstract: We propose a RUM model in which we explicitly introduce the budget constraint in the migration decision: individuals cannot afford migrating to a destination for which the migration cost (which depends on the migration policy of the destination) is higher than their current income. We find that the migration rate between two countries depends on the characteristics of the origin and destination countries and their relative accessibility, and also on a budget constraint term. This term depends on attributes of alternative destination countries. Thus, the model exhibits multilateral resistance to migration. We perform a numerical analysis based on 25 European countries in 2008, and find that the explanatory power of the model improves when the budget constraint is taken into account. We evidence multilateral resistance to migration induced by the implementation of intra-EU migration restrictions following the 2004 EU enlargement.
