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The economics of immigration into a Nordic welfare state - and a comparison to an immigration state and a guest worker state

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  • Sheetal K. Chand
  • Martin Paldam

    ()
    (Department of Economics, University of Aarhus, Denmark)

Abstract

This paper examines the economic and related consequences of immigration from a less developed country (LDC) to a developed country (DC) in three different stylized cases: A guest worker society of the Dubai type, an immigrant society of the US type, and a tax-based welfare state with institutions of the Nordic type. In the Dubai type case it appears that mutually beneficial decisions can be made, and the same applies to a degree in the US type case. However, in the Nordic type evolved welfare case, immigration is only an advantage for the immigrant, especially one with less marketable skills, while it is a disadvantage for the natives. This poses an additional threat to the continuation of this type of welfare state.

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Bibliographic Info

Paper provided by School of Economics and Management, University of Aarhus in its series Economics Working Papers with number 2004-4.

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Length: 25
Date of creation: 13 May 2004
Date of revision:
Handle: RePEc:aah:aarhec:2004-4

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Web page: http://www.econ.au.dk/afn/

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Keywords: Immigration; welfare state;

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  1. Storesletten, Kjetil, 2001. "Fiscal Implications of Immigration - A Net Present Value Calculation -," Seminar Papers 701, Stockholm University, Institute for International Economic Studies.
  2. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
  3. Jorgen Hansen & Magnus Lofstrom, 2003. "Immigrant Assimilation and Welfare Participation Do Immigrants Assimilate Into or Out of Welfare?," Journal of Human Resources, University of Wisconsin Press, vol. 38(1).
  4. Borjas, George J, 1999. "Immigration and Welfare Magnets," Journal of Labor Economics, University of Chicago Press, vol. 17(4), pages 607-37, October.
  5. Paldam, M. & Svendsen, G.T., 2000. "Missing Social Capital and the Transition in Eastern Europe," Papers 00-5, Aarhus School of Business - Department of Economics.
  6. Sinn, Hans-Werner, 2004. "EU Enlargement, Migration and the New Constitution," Munich Reprints in Economics 19609, University of Munich, Department of Economics.
  7. Timothy J. Hatton & Jeffrey G. Williamson, 2002. "What Fundamentals Drive World Migration?," NBER Working Papers 9159, National Bureau of Economic Research, Inc.
  8. Blume, Kraen & Verner, Mette, 2007. "Welfare dependency among Danish immigrants," European Journal of Political Economy, Elsevier, vol. 23(2), pages 453-471, June.
  9. Paldam, Martin, 2002. "The cross-country pattern of corruption: economics, culture and the seesaw dynamics," European Journal of Political Economy, Elsevier, vol. 18(2), pages 215-240, June.
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Cited by:
  1. Pawel Kaczmarczyk, 2013. "Are immigrants a burden for the state budget? Review paper," EUI-RSCAS Working Papers p0356, European University Institute (EUI), Robert Schuman Centre of Advanced Studies (RSCAS).
  2. Juan A. Lacomba & Francisco Lagos, 2010. "Immigration and Pension Benefits in the Host Country," Economica, London School of Economics and Political Science, vol. 77(306), pages 283-295, 04.
  3. Tim Krieger & Steffen Minter, 2007. "Immigration amnesties in the southern EU member states - a challenge for the entire EU?," Working Papers CIE 6, University of Paderborn, CIE Center for International Economics.
  4. Krieger, Tim, 2005. "Renten und Zuwanderung: Ein Überblick über neue Ergebnisse der Forschung," Arbeitspapiere der Nordakademie 2005-04, Nordakademie - Hochschule der Wirtschaft.

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