Abstract
Venezuela’s collapsing economy coupled with an unstable political climate has prompted the mass exodus of Venezuelans who flee to neighbouring countries in Latin America and the Caribbean. This chapter focuses on the effect of the migrants arriving on the shores of Trinidad and Tobago due to its close proximity. Understanding that the accelerated arrival of migrants in Trinidad and Tobago places additional strain on an economy that has not exhibited robust economic growth, has a growing debt-to-GDP ratio and mounting national debt, we must acknowledge that there are both challenges and opportunities as a result of the influx of Venezuelan migrants to Trinidad and Tobago, with the latter outweighing the former. In this study, we provide conclusive theoretical and empirical evidence that the presence of migrant Venezuelans in Trinidad and Tobago can have a positive impact on the economy and on the labour market, which leads to an increase in the income of the owners of capital, though at the expense of employment of low-skilled nationals.
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Notes
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The assumptions of this model are as follows:
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1.
We have a closed economy.
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2.
There are only two factors of production, capital (K) and labour (L).
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3.
Both factors of production, K and L, are perfectly divisible, mobile and somewhat substitutable.
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We segment the economy into two industries, each producing one good. One industry produces goods that make intensive use of the Venezuelan labour, while the other does not.
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5.
Both industries have linear homogeneous production functions of degree one.
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The “factor intensity” of both industries is different. That is, the production conditions for both industries are such that the ratio marginal physical product of K is always equalized as marginal physical product of L between the two industries by using the higher ratio in one of the industries (the K-intensive industry) and a lower ratio in the other (L-intensive industry).
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Sealy, C., Conrad, D.A. (2023). The Impact of Venezuelan Migration on the Labour Market in Trinidad and Tobago. In: Wallace, W.C. (eds) The Movement of Venezuelans to the Americas and the Caribbean in the 21st Century. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-031-31762-0_7
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