This paper explores the effects of high skilled immigration to a host country with unionized low skilled labor and an unemployment insurance scheme. We show that such immigration can create a negative immigration surplus due to adverse effects on low skilled employment, provided that fiscal redistribution is not too intense and the elasticity between high and low skilled labor is high as empirical evidence suggests.
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number
CESifo Working Paper No. 2409.
Find related papers by JEL classification: F22 - International Economics - - International Factor Movements and International Business - - - International Migration H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers J65 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment Insurance; Severance Pay; Plant Closings
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