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Immigration and income redistribution: A political economy analysis

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  • Karin Mayr

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Abstract

This paper examines the effect of immigration on the extent of income redistribution via majority voting on the income tax. The tax outcome depends on the size of the native majority and the initial amount of redistribution in the economy, which in turn determines the skill composition of immigrants. As a main result, we derive conditions for multiple tax equilibria: if the native majority of either skilled or unskilled is not too strong and immigrants are allowed to vote, both a high-tax and a low-tax outcome is possible. In a referendum, natives will then vote against immigrant voting. At best, natives are indifferent towards immigrant voting. Copyright Springer Science+Business Media, LLC 2007

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Bibliographic Info

Article provided by Springer in its journal Public Choice.

Volume (Year): 131 (2007)
Issue (Month): 1 (April)
Pages: 101-116

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Handle: RePEc:kap:pubcho:v:131:y:2007:i:1:p:101-116

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Web page: http://www.springerlink.com/link.asp?id=100332

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Keywords: Political economy; Immigration; Income redistribution;

References

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  1. Assaf Razin & Effraim Sadka & Phillip Swagel, 1998. "Tax Burden and Migration: A Political Economy Theory and Evidence," NBER Working Papers 6734, National Bureau of Economic Research, Inc.
  2. Wildasin, D.E., 1992. "Income Restribution and Migration," Papers 92-003, Indiana - Center for Econometric Model Research.
  3. Haupt, Alexander & Peters, Wolfgang, 1998. " Public Pensions and Voting on Immigration," Public Choice, Springer, vol. 95(3-4), pages 403-13, June.
  4. Mazza, Isidoro & van Winden, Frans, 1996. " A Political Economic Analysis of Labor Migration and Income Redistribution," Public Choice, Springer, vol. 88(3-4), pages 333-63, September.
  5. Cremer, Helmuth & Pestieau, Pierre, 1998. "Social insurance, majority voting and labor mobility," Journal of Public Economics, Elsevier, vol. 68(3), pages 397-420, June.
  6. Alexander Kemnitz, 2002. "On the Political Economy of Low Skilled Immigration and the Welfare State," International Tax and Public Finance, Springer, vol. 9(4), pages 423-434, August.
  7. Jonathan Coppel & Jean-Christophe Dumont & Ignazio Visco, 2001. "Trends in Immigration and Economic Consequences," OECD Economics Department Working Papers 284, OECD Publishing.
  8. Marcel Thum, 2004. "Controlling Migration in an Open Labor Market," Public Choice, Springer, vol. 119(3_4), pages 425-443, 06.
  9. Lejour, Arjan M & Verbon, Harrie A A, 1994. " Labour Mobility and Decision Making on Social Insurance in an Integrated Market," Public Choice, Springer, vol. 79(1-2), pages 161-85, April.
  10. Benhabib, Jess, 1996. "On the political economy of immigration," European Economic Review, Elsevier, vol. 40(9), pages 1737-1743, December.
  11. Scholten, Ulrich & Thum, Marcel, 1996. " Public Pensions and Immigration Policy in a Democracy," Public Choice, Springer, vol. 87(3-4), pages 347-61, June.
  12. Jim Dolmas & Gregory W. Huffman, 2003. "The Political Economy of Immigrationa and Income Redistribution," Vanderbilt University Department of Economics Working Papers 0312, Vanderbilt University Department of Economics.
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Citations

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Cited by:
  1. Holger Stichnoth, 2012. "Does immigration weaken natives’ support for the unemployed? Evidence from Germany," Public Choice, Springer, vol. 151(3), pages 631-654, June.
  2. Gaston, Noel & Rajaguru, Gulasekaran, 2013. "International migration and the welfare state revisited," European Journal of Political Economy, Elsevier, vol. 29(C), pages 90-101.
  3. Giuseppe Russo, 2011. "Voting over Selective Immigration Policies with Immigration Aversion," CSEF Working Papers 289, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
  4. Bergh, Andreas & Fink, Günther, 2009. "Immigrants’ Attitudes towards Redistribution: Implications for the Welfare State," Ratio Working Papers 138, The Ratio Institute.
  5. Spiros Bougheas & Doug Nelson, . "On the Political Economy of High Skilled Migration and International Trade," Discussion Papers 12/06, University of Nottingham, GEP.
  6. Christine Fauvelle-Aymar, 2014. "The welfare state, migration, and voting rights," Public Choice, Springer, vol. 159(1), pages 105-120, April.
  7. Benjamin Powell, 2012. "Coyote ugly: the deadweight cost of rent seeking for immigration policy," Public Choice, Springer, vol. 150(1), pages 195-208, January.

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