Aging, Factor Returns, and Immigration Policy
AbstractIn this note we analyze how aging affects immigration policy. We set up a dynamic political-economy model of representative democracy in which the government of the destination country sets the immigration level to maximize aggregate welfare of the constituency. Aging, i.e. a decline in the growth rate of the native population, has an expansionary effect on immigration. This immigration effect may even overcompensate the initial decline in population growth such that the total labor force grows more strongly and the capital stock per worker declines. We also compare our results to the social planner allocation and to the median-voter equilibrium.
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Bibliographic InfoPaper provided by Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) in its series MAGKS Papers on Economics with number 200926.
Length: 8 pages
Date of creation: 2009
Date of revision:
Publication status: Forthcoming in
Demographic change; political economy; immigration policy;
Other versions of this item:
- D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
This paper has been announced in the following NEP Reports:
- NEP-AGE-2009-06-10 (Economics of Ageing)
- NEP-ALL-2009-06-10 (All new papers)
- NEP-DGE-2009-06-10 (Dynamic General Equilibrium)
- NEP-MIG-2009-06-10 (Economics of Human Migration)
- NEP-POL-2009-06-10 (Positive Political Economics)
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- Lena Calahorrano & Philipp an de Meulen, 2011. "Demographics and Factor Flows – A Political Economy Approach," Ruhr Economic Papers 0299, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
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