The present paper systematically investigates the pattern and effect of international factor mobility caused by international differences of production technology in an endogenous-population-growth and overlapping-generations model. We show here that if the autarkic steady state in each country is characterized by under-investment relative to the Golden Rule, international labour migration will take place to the country with a more capital-saving or a neutrally superior technology, and then the capital-labour ratio and the demand for children per family in that country will be lower. On the other hand, international capital will move to the country with a more labour-saving or a neutrally superior technology and will decrease the per worker domestic capital stock in that country.
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I am very grateful to Professor Murray C. Kemp and two anonymous referees for valuable comments and discussion.
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Kondo, H. International factor mobility and production technology. J Popul Econ 2, 281–299 (1989). https://doi.org/10.1007/BF00171005
- Steady State
- Production Technology
- Capital Stock
- International Factor
- Labour Migration