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Immigration and Pension Benefits in the Host Country

  • JUAN A. LACOMBA
  • FRANCISCO LAGOS

This paper examines the role that low-skilled immigration plays in determining pension benefits of the host population. With an overlapping-generations model which allows identifying which groups of native population are in favour or against immigration, we find that despite immigrants having low average productivity, an open borders policy would be implemented since most of current domestic cohorts gain from immigration. Only younger workers might be against immigration since they will coincide with immigrants in their retirement periods. Moreover, we show how a larger immigrant quota would increase the probability of a Pareto improvement for the current domestic population. Copyright (c) The London School of Economics and Political Science 2008.

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Article provided by London School of Economics and Political Science in its journal Economica.

Volume (Year): 77 (2010)
Issue (Month): 306 (04)
Pages: 283-295

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Handle: RePEc:bla:econom:v:77:y:2010:i:306:p:283-295
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  1. Juan Lacomba & Francisco Lagos, 2006. "Population aging and legal retirement age," Journal of Population Economics, Springer, vol. 19(3), pages 507-519, July.
  2. CASAMATTA, Georges & CREMER , Helmuth & PESTIEAU, Pierre, . "The political economy of social security," CORE Discussion Papers RP -1475, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  3. Tim Krieger, 2004. "Fertility rates and skill distribution in Razin and Sadka’s migration-pension model: A note," Journal of Population Economics, Springer, vol. 17(1), pages 177-182, February.
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  7. Assaf Razin & Efraim Sadka, 1999. "Unskilled Migration: A Burden or a Boon for the Welfare State," NBER Working Papers 7013, National Bureau of Economic Research, Inc.
  8. Sheetal K. Chand & Martin Paldam, 2004. "The economics of immigration into a Nordic welfare state - and a comparison to an immigration state and a guest worker state," Economics Working Papers 2004-4, School of Economics and Management, University of Aarhus.
  9. Slobodan Djajić, 2003. "Assimilation of immigrants: Implications for human capital accumulation of the second generation," Journal of Population Economics, Springer, vol. 16(4), pages 831-845, November.
  10. Tim Krieger, 2004. "Public pensions and immigration policy when voters are differently skilled," Public Economics 0411006, EconWPA.
  11. Lindbeck, Assar & Persson, Mats, 2002. "The Gains from Pension Reform," Working Paper Series 580, Research Institute of Industrial Economics.
  12. Assaf Razin & Efraim Sadka, 1995. "Population Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262181606, June.
  13. Tim Krieger, 2008. "Public pensions and return migration," Public Choice, Springer, vol. 134(3), pages 163-178, March.
  14. Krieger, Tim, 2003. " Voting on Low-Skill Immigration under Different Pension Regimes," Public Choice, Springer, vol. 117(1-2), pages 51-78, October.
  15. Haupt, Alexander & Peters, Wolfgang, 1998. " Public Pensions and Voting on Immigration," Public Choice, Springer, vol. 95(3-4), pages 403-13, June.
  16. Scholten, Ulrich & Thum, Marcel, 1996. " Public Pensions and Immigration Policy in a Democracy," Public Choice, Springer, vol. 87(3-4), pages 347-61, June.
  17. Lagos Francisco & Lacomba Juan, 2005. "The Role of Immigration in the Retirement Age Reform : A Theoretical Analysis," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(1), pages 1-20, September.
  18. Leers, Theo & Meijdam, Lex & Verbon, Harrie A. A., 2004. "Ageing, migration and endogenous public pensions," Journal of Public Economics, Elsevier, vol. 88(1-2), pages 131-159, January.
  19. Razin, Assaf & Sadka, Efraim, 1999. "Migration and pension with international capital mobility," Journal of Public Economics, Elsevier, vol. 74(1), pages 141-150, October.
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