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Immigration as a commitment device

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Listed author(s):
  • Alexander Kemnitz

    ()

Abstract

This paper shows that the toleration of immigrants who are on average less skilled than natives can be part of a support-maximizing government policy, despite a general political bias in favor of the poor. We make this point in a simple model with redistributive unemployment insurance. Once wage contracts are binding, the government has an incentive to increase the unemployment benefit, leading to excessive unemployment. Affecting the political balance within the constituency, immigrants can serve as a commitment device against this time-inconsistency. We show that this possibility can be greatly promoted by restrictions on political naturalization.

(This abstract was borrowed from another version of this item.)

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File URL: http://hdl.handle.net/10.1007/s00148-005-0042-y
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Article provided by Springer & European Society for Population Economics in its journal Journal of Population Economics.

Volume (Year): 19 (2006)
Issue (Month): 2 (June)
Pages: 299-313

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Handle: RePEc:spr:jopoec:v:19:y:2006:i:2:p:299-313
DOI: 10.1007/s00148-005-0042-y
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Keywords: Immigration; Welfare state; Democracy; Time inconsistency; D72; F22; J68;

Other versions of this item:

Find related papers by JEL classification:
  • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
  • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
  • F22 - International Economics - - International Factor Movements and International Business - - - International Migration

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  1. Casey B. Mulligan & Xavier Sala-i-Martin, 1999. "Gerontocracy, retirement, and social security," Economics Working Papers 383, Department of Economics and Business, Universitat Pompeu Fabra.
  2. Assar Lindbeck & Jörgen Weibull, 1987. "Balanced-budget redistribution as the outcome of political competition," Public Choice, Springer, vol. 52(3), pages 273-297, January.
  3. Anna Maria Mayda, 2006. "Who Is Against Immigration? A Cross-Country Investigation of Individual Attitudes toward Immigrants," The Review of Economics and Statistics, MIT Press, vol. 88(3), pages 510-530, August.
  4. Bauer, Thomas K. & Lofstrom, Magnus & Zimmermann, Klaus F., 2000. "Immigration Policy, Assimilation of Immigrants and Natives' Sentiments towards Immigrants: Evidence from 12 OECD-Countries," IZA Discussion Papers 187, Institute for the Study of Labor (IZA).
  5. Casarico, Alessandra & Devillanova, Carlo, 2003. "Social security and migration with endogenous skill upgrading," Journal of Public Economics, Elsevier, vol. 87(3-4), pages 773-797, March.
  6. Paola Profeta, 2002. "Retirement and Social Security in a Probabilistic Voting Model," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 9(4), pages 331-348, August.
  7. Mazza, Isidoro & van Winden, Frans, 1996. "A Political Economic Analysis of Labor Migration and Income Redistribution," Public Choice, Springer, vol. 88(3-4), pages 333-363, September.
  8. Razin, Assaf & Sadka, Efraim & Swagel, Phillip, 2002. "Tax burden and migration: a political economy theory and evidence," Journal of Public Economics, Elsevier, vol. 85(2), pages 167-190, August.
  9. Kemnitz, Alexander, 2003. "Unemployment, Technology and the Welfare Effects of Immigration," Discussion Papers 611, Institut fuer Volkswirtschaftslehre und Statistik, Abteilung fuer Volkswirtschaftslehre.
  10. George E. Johnson, 1997. "Changes in Earnings Inequality: The Role of Demand Shifts," Journal of Economic Perspectives, American Economic Association, vol. 11(2), pages 41-54, Spring.
  11. Fuest, Clemens & Thum, Marcel, 2001. "Immigration and skill formation in unionised labour markets," European Journal of Political Economy, Elsevier, vol. 17(3), pages 557-573, September.
  12. Alexander Kemnitz, 2002. "On the Political Economy of Low Skilled Immigration and the Welfare State," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 9(4), pages 423-434, August.
  13. Fuest, Clemens & Thum, Marcel, 2000. "Welfare effects of immigration in a dual labor market," Regional Science and Urban Economics, Elsevier, vol. 30(5), pages 551-563, September.
  14. Kenneth F. Scheve & Matthew J. Slaughter, 2001. "Labor Market Competition And Individual Preferences Over Immigration Policy," The Review of Economics and Statistics, MIT Press, vol. 83(1), pages 133-145, February.
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