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Ethnic Diversity and Preferences for Redistribution

  • Matz Dahlberg
  • Karin Edmark
  • Hel�ne Lundqvist

This paper investigates the causal link between the ethnic diversity in a society and its inhabitants’ preferences for redistribution. We exploit exogenous variation in immigrant shares stemming from a nationwide program placing refugees in municipalities throughout Sweden during 1985–94 and match data on refugee placement to panel survey data on inhabitants of the receiving municipalities. We find significant, negative effects of increased immigration on the support for redistribution. The effect is especially pronounced among high-income earners. We also establish that estimates from earlier studies failing to identify causal effects are likely to be positively biased (i.e., less negative).

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File URL: http://www.jstor.org/stable/pdfplus/10.1086/665800
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File URL: http://www.jstor.org/stable/full/10.1086/665800
Download Restriction: Access to the online full text or PDF requires a subscription.

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Article provided by University of Chicago Press in its journal Journal of Political Economy.

Volume (Year): 120 (2012)
Issue (Month): 1 ()
Pages: 41 - 76

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Handle: RePEc:ucp:jpolec:doi:10.1086/665800
Contact details of provider: Web page: http://www.journals.uchicago.edu/JPE/

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  1. Woojin Lee & John Roemer & Karine Van der Straeten, 2006. "Racism, Xenophobia, and Redistribution," Journal of the European Economic Association, MIT Press, vol. 4(2-3), pages 446-454, 04-05.
  2. Karin Edmark & Matz Dahlberg, 2004. "Is There a "Race-to-the-Bottom" in the Setting of Welfare Benefit Levels? Evidence from a Policy Intervention," Econometric Society 2004 North American Summer Meetings 473, Econometric Society.
  3. Erzo F. P. Luttmer, 2001. "Group Loyalty and the Taste for Redistribution," Journal of Political Economy, University of Chicago Press, vol. 109(3), pages 500-528, June.
  4. Christer Gerdes, 2011. "The Impact of Immigration on the Size of Government: Empirical Evidence from Danish Municipalities," Scandinavian Journal of Economics, Wiley Blackwell, vol. 113(1), pages 74-92, 03.
  5. Alberto Alesina & Reza Baqir & William Easterly, 1997. "Public Goods and Ethnic Divisions," NBER Working Papers 6009, National Bureau of Economic Research, Inc.
  6. Åslund, Olof & Edin, Per-Anders & Fredriksson, Peter, 2001. "Ethnic Enclaves and the Economic Success of Immigrants - Evidence from a Natural Experiment," CEPR Discussion Papers 2729, C.E.P.R. Discussion Papers.
  7. Claudia Senik & Holger Stichnoth & Karine Van Der Straeten, 2008. "Immigration and natives' attitudes towards the welfare state: Evidence from the European Social Survey," PSE Working Papers halshs-00586256, HAL.
  8. repec:pse:psecon:2008-43 is not listed on IDEAS
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