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Ethnic Diversity and Preferences for Redistribution

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  • Matz Dahlberg
  • Karin Edmark
  • Hel�ne Lundqvist

Abstract

This paper investigates the causal link between the ethnic diversity in a society and its inhabitants’ preferences for redistribution. We exploit exogenous variation in immigrant shares stemming from a nationwide program placing refugees in municipalities throughout Sweden during 1985–94 and match data on refugee placement to panel survey data on inhabitants of the receiving municipalities. We find significant, negative effects of increased immigration on the support for redistribution. The effect is especially pronounced among high-income earners. We also establish that estimates from earlier studies failing to identify causal effects are likely to be positively biased (i.e., less negative).

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File URL: http://www.jstor.org/stable/full/10.1086/665800
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Bibliographic Info

Article provided by University of Chicago Press in its journal Journal of Political Economy.

Volume (Year): 120 (2012)
Issue (Month): 1 ()
Pages: 41 - 76

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Handle: RePEc:ucp:jpolec:doi:10.1086/665800

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References

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  1. Erzo F. P. Luttmer, 2001. "Group Loyalty and the Taste for Redistribution," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 500-528, June.
  2. Claudia Senik & Holger Stichnoth & Karine Van Der Straeten, 2008. "Immigration and natives' attitudes towards the welfare state: Evidence from the European Social Survey," PSE Working Papers halshs-00586256, HAL.
  3. Edin, Per-Anders & Fredriksson, Peter & Åslund, Olof, 2000. "Ethnic enclaves and the economic success of immigrants - evidence from a natural experiment," Working Paper Series 2000:9, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  4. repec:pse:psecon:2008-43 is not listed on IDEAS
  5. Christer Gerdes, 2011. "The Impact of Immigration on the Size of Government: Empirical Evidence from Danish Municipalities," Scandinavian Journal of Economics, Wiley Blackwell, vol. 113(1), pages 74-92, 03.
  6. Dahlberg, Matz & Edmark, Karin, 2004. "Is there a "Race-to-the-Bottom" in the Setting of Welfare Benefit Levels? Evidence from a Policy Intervention," Working Paper Series 2004:19, Uppsala University, Department of Economics.
  7. Alberto Alesina & Reza Baqir & William Easterly, 1997. "Public Goods and Ethnic Divisions," NBER Working Papers 6009, National Bureau of Economic Research, Inc.
  8. Woojin Lee & John Roemer & Karine van der Straeten, 2005. "Racism, xenophobia, and redistribution," UMASS Amherst Economics Working Papers 2005-15, University of Massachusetts Amherst, Department of Economics.
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Citations

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Cited by:
  1. Halla, Martin & Wagner, Alexander F & Zweimüller, Josef, 2012. "Does Immigration Into Their Neighborhoods Incline Voters Toward the Extreme Right? The Case of the Freedom Party of Austria," CEPR Discussion Papers 9102, C.E.P.R. Discussion Papers.
  2. Dahlberg, Matz & Edmark, Karin & Lundqvist, Helene, 2013. "Ethnic Diversity and Preferences for Redistribution: Reply," Working Paper Series 955, Research Institute of Industrial Economics.
  3. Neher, Frank, 2012. "Preferences for redistribution around the world," Discussion Papers 2012/2, Free University Berlin, School of Business & Economics.
  4. Siedler, Thomas & Sonnenberg, Bettina, 2012. "Intergenerational Earnings Mobility and Preferences for Redistribution," IZA Discussion Papers 6981, Institute for the Study of Labor (IZA).
  5. Jordi Jofre-Monseny & Pilar Sorribas-Navarro & Javier Vázquez-Grenno, 2011. "Welfare spending and ethnic heterogeneity: evidence from a massive immigration wave," Working Papers 2011/34, Institut d'Economia de Barcelona (IEB).
  6. Ronny Freier & Benny Geys & Joshua Holm, 2013. "Religious Heterogeneity and Fiscal Policy: Evidence from German Reunification," Discussion Papers of DIW Berlin 1266, DIW Berlin, German Institute for Economic Research.

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