On the other hand, in terms of their effects on wages and on the public good, immigrants of course, value immigration flows negatively. The relative strength of these components of the preferences of immigrants determines whether at equilibrium with no-commitment the immigration flow is larger or smaller than with commitment.
As long as assimilation is relatively contained, we can show that the general comparison between the flows at equilibrium with no-commitment and with commitment is not changed. While in the bare model we are using no such strategy is available, we can envision several interesting extensions which would allow for them. We offer the reader three examples.
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First, investing in irreversible border protection devices. At that point, it is relatively inexpensive to keep immigrants out, and so the government would choose, at the no-commitment equilibrium, small immigration flows relative to what it would have chosen had the wall not been built. Second, reducing the welfare weight on immigrants. Third, engaging in a tight fiscal policy.
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In other words, a fiscal surplus is a commitment device which the natives could use to restrict the incentives to admit immigrants in the future. Therefore, in the presence of this commitment device, fiscal policy at equilibrium would entail smaller budget deficits than under commitment.
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In sum, the model shows that the presence of economic and cultural externalities makes immigration policy time-inconsistent, so that the chosen immigration flow in the early period is smaller than it would be under commitment. Contrary to economic externalities, which favour high-skilled natives and so make them favourable to more immigration, cultural externalities reconcile high- and low-skill natives: the cultural motive makes both these groups averse to more immigration — although more strongly so the low-skilled.
Although at this level of analysis we cannot test the theory, we provide in the next section evidence that is consistent with it. The ESS allows us to gauge at the key driving mechanisms we have embedded in the model, namely the relation between, on the one hand, the perceived economic and cultural effects of immigration and, on the other hand, attitudes towards immigration policy.
Consider the economic impact first. They also use health and welfare services. On balance, do you think people who come here take out more than they put in or put in more than they take out? An answer between 1 and 4 is again taken as an indicator that one believes the fiscal impact of immigrants is negative. In , believing that immigrants have a negative impact on all of the three economic dimensions was associated with 40 percentage points higher probability of supporting a restrictive immigration policy last column.
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Notice that the correlations become larger between and Projection of attitude towards immigration on beliefs about its economic impact. Notes : Linear probability models. The dependent variable is a dummy taking value 1 if a respondent states that the government should allow few or no immigrants in the country. Country fixed effects are included, as well as the following individual covariates: gender, age dummies, marital status, number of children, education, employment status, self-reported trust in other people and belonging to a religious denomination.
Due to missing data in the ESS, there are no observations from Estonia and Slovakia in the regressions using the wave, and there are no observations from Greece and Italy in the regressions using the wave. Robust standard errors in parentheses, clustered at the country level. Consider the cultural impact next.
Table 2 adds this variable to the linear projections of Table 1. In this case, too, the correlation becomes larger between and This evidence is consistent with the more sophisticated analyses by Dustmann and Preston and Card et al. Table 2. Projection of attitude towards immigration on beliefs about its economic and cultural impact. This means that the cultural and the economic variables are positively correlated.
Linear fit superimposed. At the same time, the perceived labour market and fiscal effects of immigrants seem to bear no relationship with estimated effects. The actual cross-country economic effects corresponding to the perception evoked in the ESS survey are difficult to identify. Nonetheless, for the labour market effects, Docquier et al. As for the fiscal effects, Liebig and Mo provide cross-country estimates of the net fiscal contribution of immigrants in —, albeit in a static framework see Section 2. The correlation between perceived and estimated effects is illustrated in Figure 3.
Although for the labour market effects the correlation has the right sign, in most countries the wage and employment impacts of immigrants are estimated to be positive, contrary to the perception of negative effects by a large share of natives. For the fiscal effects, instead, the correlation if any has the wrong sign.
Services on Demand
Notes: The figure relates the perceived labour market and fiscal effects of immigration horizontal axis and the actual effects as estimated by Docquier et al. Sampling weights are applied to ESS data. Ireland is excluded from this figure because it is an outlier.
Taking the estimated effects at face value, how can we explain the stark discrepancy between perceptions and reality? Estimates of economic effects certainly are. For instance, a respondent who is intolerant towards immigrants because of cultural or ethnic reasons may have persuaded himself or report to the interviewer, as a justification that immigration has adverse economic effects. To corroborate this presumption, consider one of the implications of the model: absent cultural externalities, if all immigrants are low skilled then their ethnic identity should be irrelevant for natives.
Not so in the data: the expressed preference for a restrictive immigration policy varies with respect to the ethnic origin of immigrants. The population-weighted average fractions across the 22 countries are In the model, low-skilled natives oppose immigration because of negative economic and cultural externalities.
On the contrary, high-skilled natives oppose immigration because of cultural and political externalities and some negative perceived fiscal externality, possibly but favour it because of their complementarity in the labour market. Presumably, the cultural externality is smaller for the high-skilled because they have limited social contact with immigrants relative to the low-skilled.
We have motivated and studied a model of the effects of immigration flows where cultural externalities are a driving force in addition to standard economic externalities. Contrary to the latter, which favour high-skilled natives and so make some voters favourable to more immigration, cultural externalities make both high- and low-skill natives averse to more immigration, although more so the low-skilled. Evidence from the ESS is consistent with this theoretical structure, supporting our claim that one gains deeper insights into immigration policy by considering the nature and consequences of the cultural externalities generated by immigration.
Perhaps it is no accident that these three examples correspond to heated political issues in contemporary Europe. Although the model we have studied is simple and lays no claims to being general, we believe it leads to important insights and, most important, it provides a theoretical framework for more comprehensive studies of immigration policy when cultural concerns play a primary role in shaping attitudes towards migrants in receiving countries. This seems to us a key issue in the present economic and political landscape.
International Migration: Trends, Policies, and Economic Impact - Google книги
The average is taken across the entire population, which includes both natives and immigrants. Natives are of two types, high-skilled and low-skilled. Immigrants are low-skilled and therefore are a substitute for low-skilled natives. With a well-behaved, constant-returns-to-scale production function and perfectly competitive markets, the wage of high-skilled workers will be an increasing function of the number of immigrants, while that of low-skilled workers a decreasing function.
Therefore, high-skilled workers will favour immigration while low-skilled workers will oppose it. The authors consider also another mechanism that pushes in the same direction, i. There are two periods. The focus of the analysis is on the fact that first-period immigrants will add to the number of low-skilled workers, implying that in the second period the average agent will be less favourable to immigration.
Therefore, in the second period, fewer immigrants will be admitted than in the presence of commitment.
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Since this distortion is larger, the greater the number of first-period immigrants, in order to reduce the second-period distortion the number of first-period immigrants will also be distorted downward. Therefore, both first-period immigrants and the total number of immigrants will be lower in the absence of commitment than under commitment Proposition 2. If commitment is not possible, how could natives attenuate these distortions? One possibility is to run a fiscal deficit, issuing public debt which must be redeemed in period 2.
This raises the value of period-2 immigrants, who will pay taxes thus contributing to finance first-period expenditures. As a result, second-period immigration will be closer to the commitment solution.