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Frontiers of Economics in China

Front. Econ. China    2018, Vol. 13 Issue (1) : 15-31     https://doi.org/10.3868/s060-007-018-0003-7
Orginal Article |
Free-Trade Agreements in a Model of Trade, Migration and Politics
John Douglas Wilson1(), Ilkay Yilmaz2()
1. Department of Economics, Michigan State University, East Lansing, MI 48824, USA
2. Department of Economics, Mersin University, Ciftlikkoy, Yenisehir 33342, Mersin, Turkey
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Abstract

This paper uses a probabilistic voting model to investigate voting for a free-trade agreement between a labor-abundant country and a capital-abundant country. Migration from the labor-abundant country to the capital-abundant country increases the probability of a free-trade agreement, with lower migration costs leading to more migration and a higher free-trade probability. On the other hand, if a lower probability of free trade is caused by an increased voter bias against free-trade candidates, then there is less migration. A dynamic extension of the model is also investigated.

Keywords free trade      migration      Heckscher-Ohlin      labor-abundant      capital- abundant     
Issue Date: 15 March 2018
 Cite this article:   
John Douglas Wilson,Ilkay Yilmaz. Free-Trade Agreements in a Model of Trade, Migration and Politics[J]. Front. Econ. China, 2018, 13(1): 15-31.
 URL:  
http://journal.hep.com.cn/fec/EN/10.3868/s060-007-018-0003-7
http://journal.hep.com.cn/fec/EN/Y2018/V13/I1/15
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