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Small States, Micro States, and their International Negotiation and Migration

Author

Listed:
  • Schiff , Maurice

    (IZA-Institute for the Study of Labor)

Abstract

Due to low bargaining power and scarce resources, small developing states face severe disadvantages in international negotiations and may benefit from bloc formation and intra-bloc migration. Policies are examined in a model where a bloc’s size and welfare impact are determined by international and regional negotiation costs, bargaining power, accession rule, and intra-bloc migration. The main findings are: (i) bloc formation likelihood, size, and benefit increase with international negotiation costs; (ii) intra-bloc migration acts as a public good, raising regional benefits; (iii) bloc size is optimal in the presence of accession fees; (iv) intra-bloc migration and North-South trade are complements under negotiations for increased market access. Thus, even if trading identical goods, small neighboring states should consider forming an international negotiating bloc and supporting intra-bloc migration.

Suggested Citation

  • Schiff , Maurice, 2014. "Small States, Micro States, and their International Negotiation and Migration," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 29, pages 430-449.
    • Handle: RePEc:ris:integr:0635
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    Cited by:

    1. Jeffrey A Edwards & Alfredo A. Romero, 2020. "Volatility, island nations and small states," Economics and Business Letters, Oviedo University Press, vol. 9(3), pages 248-254.

    More about this item

    Keywords

    Small States; International; Negotiations; Regional; Cooperation; South-South Migration; Bloc Size; Welfare;
    All these keywords.

    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration

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