Abstract
This article seeks to explain the contradiction between the promises of welfare gains derived from the economic models recommending the removal of immigration restrictions, and the reality experienced by countries attempting to apply restrictions to immigration flows. A formal model is built in which the strategic reaction of countries takes into account not only those benefits derived from migration, but also the (economic and non-economic) costs that migration can generate in the host country. Strategic reactions drive what may be called the “paradox of adverse interest”: the fewer potential gains associated with migratory liberalisation, the easier it becomes for nations to reach an unrestrictive agreement. The existence of two asymmetries (between the bargaining power of receiving and sending countries, and between the private nature of most of migration’s benefits and the social nature of its main costs) can frustrate agreement when the countries involved exhibit a high wage differential. Results suggest that permissive international agreements on migration are easier to reach in regional contexts, among countries with proximate economic conditions and levels of income.