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Immigration and welfare state cash benefits: the Danish case

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  • Peder J. Pedersen

Abstract

Purpose – The purpose of this paper is to summarize existing evidence on welfare dependence among immigrants in Denmark and to produce new evidence with focus on the most recent years. Design/methodology/approach – The paper combines a broad descriptive/analytical approach with multivariate estimation on the impact on welfare dependence from individual background factors. Findings – The main finding is the importance of aggregate low unemployment for immigrants to assimilate out of welfare dependence. Fairly small effects are reported from policy changes intending to influence the economic incentives between welfare programs and jobs. Research limitations/implications – While panel data as used in the paper have a great potential, still a number of policy changes are not identified at the individual level. In further work it would be relevant to broaden the coverage including also some small policy programs and to extend the analysis to cover the period including the financial crisis years. Social implications – The paper has a potential to influence public attitudes in this area and to inform further public policy regarding benefit programs. Originality/value – The main new result is the finding, at a disaggregate level, of how changes in immigration policy and cyclical changes interact, influencing the assimilation into or out of dependence on cash benefit programs.

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Bibliographic Info

Article provided by Emerald Group Publishing in its journal International Journal of Manpower.

Volume (Year): 34 (2013)
Issue (Month): 2 (February)
Pages: 113-125

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Handle: RePEc:eme:ijmpps:v:34:y:2013:i:2:p:113-125

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Related research

Keywords: Benefits; Cash benefit programs; Cyclical impact; Denmark; Immigration; Immigration policies; Public policy; Social welfare policy; Welfare dependence;

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References

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  1. Alan Barrett & Yvonne McCarthy, 2008. "Immigrants and Welfare Programmes: Exploring the Interactions between Immigrant Characteristics, Immigrant Welfare Dependence and Welfare Policy," Papers WP238, Economic and Social Research Institute (ESRI).
  2. Nannestad, Peter, 2007. "Immigration and welfare states: A survey of 15 years of research," European Journal of Political Economy, Elsevier, vol. 23(2), pages 512-532, June.
  3. Pedersen, Peder J. & Pytlikova, Mariola & Smith, Nina, 2008. "Selection and network effects--Migration flows into OECD countries 1990-2000," European Economic Review, Elsevier, vol. 52(7), pages 1160-1186, October.
  4. Blume, Kræn & Verner, Mette, 2006. "Welfare Dependency among Danish Immigrants," Working Papers 06-6, University of Aarhus, Aarhus School of Business, Department of Economics.
  5. Rosholm, Michael & Vejlin, Rune Majlund, 2007. "Reducing Income Transfers to Refugee Immigrants: Does Starthelp Help You Start?," IZA Discussion Papers 2720, Institute for the Study of Labor (IZA).
  6. Nannestad, Peter, 2004. "Immigration as a challenge to the Danish welfare state?," European Journal of Political Economy, Elsevier, vol. 20(3), pages 755-767, September.
  7. Clausen, Jens & Heinesen, Eskil & Hummelgaard, Hans & Husted, Leif & Rosholm, Michael, 2009. "The effect of integration policies on the time until regular employment of newly arrived immigrants: Evidence from Denmark," Labour Economics, Elsevier, vol. 16(4), pages 409-417, August.
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