Migration and Rural Welfare: The Impact of Potential Policy Reforms in Europe

This paper uses an agricultural household model in an imperfect market environment and data from Burkina Faso to explore the impact of potential immigration policy reforms in Europe on the welfare of rural households. Simulation results demonstrate that, in contrast to continental migration, increased intercontinental migration has strong positive household welfare effects. Similarly, an increase in the stay abroad of intercontinental migrants impacts positively on welfare of the migrant-sending household. Results of these simulations lend support to the introduction of a TMP, which would, in addition to facilitating migration control in host economies, improve the welfare of sending households by allowing for increased engagement in intercontinental migration. The temporary nature of such a program would ensure that "Dutch disease" effects would be mitigated through eventual migrant return. (C) 2012 Elsevier Ltd. All rights reserved.