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Migration and the Welfare State: Political-Economy Policy Formation

Author

Listed:
  • Razin, Assaf

    () (Tel Aviv University)

  • Sadka, Efraim

    () (Tel Aviv University)

  • Suwankiri, Benjarong

    () (Cornell University)

Abstract

Nobel laureate economist Milton Friedman once noted that free immigration cannot coexist with a welfare state. A welfare state with open borders might turn into a haven for poor immigrants, which would place such a fiscal burden on the state that native-born voters would support less-generous benefits or restricted immigration, or both. And yet a welfare state with an aging population might welcome young skilled immigrants. The preferences of the native-born population toward migration depend on the skill and age composition of the immigrants, and migration policies in a political-economy framework may be tailored accordingly. This book examines how social benefits-immigrations political economy conflicts are resolved, with an empirical application to data from Europe and the developed countries, integrating elements from population, international, public, and political economics into a unified static and dynamic framework. Using a static analytical framework to examine intra-generational distribution, the authors first focus on the skill composition of migrants in both free and restricted immigration policy regimes, drawing on empirical research from EU-15 and non-EU-15 states. The authors then offer theoretical analyses of similar issues in dynamic overlapping generations settings, studying not only intragenerational but also intergenerational aspects, including old-young dependency ratios and skilled-unskilled conflicts. Finally, they examine overall gains from or costs of migration in both host and source countries and the race to the bottom argument of tax competition between states in the presence of free migration.

Suggested Citation

  • Razin, Assaf & Sadka, Efraim & Suwankiri, Benjarong, 2011. "Migration and the Welfare State: Political-Economy Policy Formation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262016109, January.
  • Handle: RePEc:mtp:titles:0262016109
    as

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    Citations

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    Cited by:

    1. Ian Preston, 2014. "The Effect of Immigration on Public Finances," Economic Journal, Royal Economic Society, vol. 124(580), pages 569-592, November.
    2. Paolo E. Giordani & Michele Ruta, 2016. "Self-confirming immigration policy," Oxford Economic Papers, Oxford University Press, vol. 68(2), pages 361-378.
    3. Torben M. Andersen & Allan Sørensen, 2013. "Product market integration, tax distortions and public sector size," Economics Working Papers 2013-28, Department of Economics and Business Economics, Aarhus University.
    4. Michel Beine & Brian B. Burgoon & Mary Crock & Justin Gest & Michael Hiscox & Patrick McGovern & Hillel Rapoport & Eiko Thielemann, 2015. "Measuring Immigration Policies: Preliminary Evidence from IMPALA," CESifo Economic Studies, CESifo, vol. 61(3-4), pages 527-559.
    5. Gunther Tichy, 2015. "Protecting social inclusion and mobility in a low growth scenario," WWWforEurope Working Papers series 100, WWWforEurope.
    6. Corrado Giulietti & Jackline Wahba, 2013. "Welfare migration," Chapters,in: International Handbook on the Economics of Migration, chapter 26, pages 489-504 Edward Elgar Publishing.
    7. Assaf Razin & Jackline Wahba, 2012. "Migration Policy and the Generosity of the Welfare State in Europe," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 9(4), pages 28-31, 02.
    8. Razin, Assaf & Sadka, Efraim, 2017. "Migration-Induced Redistribution with and without migrant voting," CEPR Discussion Papers 12175, C.E.P.R. Discussion Papers.
    9. Giuranno, Michele G. & Rongili, Biswas, 2012. "Inter-jurisdictional migration and the size of government," MPRA Paper 42604, University Library of Munich, Germany.
    10. Russo, Giuseppe & Salsano, Francesco, 2012. "Electoral systems and immigration," MPRA Paper 38497, University Library of Munich, Germany.
    11. Gurgen Aslanyan, 2014. "The migration challenge for PAYG," Journal of Population Economics, Springer;European Society for Population Economics, vol. 27(4), pages 1023-1038, October.
    12. Stark, Oded & Casarico, Alessandra & Devillanova, Carlo & Uebelmesser, Silke, 2012. "On the formation of international migration policies when no country has an exclusive policy-setting say," Regional Science and Urban Economics, Elsevier, vol. 42(3), pages 420-429.
    13. J. Atsu Amegashie & Michael Batu, 2015. "Wider Boundaries: The Welfare State and International Remittances," CESifo Working Paper Series 5456, CESifo Group Munich.
    14. repec:ces:ifodic:v:9:y:2012:i:4:p:17566036 is not listed on IDEAS
    15. Giuranno, Michele & Biswas, Rongili, 2015. "Internal migration and public policy," POLIS Working Papers 183, Institute of Public Policy and Public Choice - POLIS.
    16. Nowotny, Klaus, 2013. "Institutions and the Location Decisions of Highly Skilled Migrants to Europe," Working Papers in Economics 2013-3, University of Salzburg.
    17. Jeffrey D. Sachs, 2016. "Toward an International Migration Regime," American Economic Review, American Economic Association, vol. 106(5), pages 451-455, May.
    18. Zaiceva, A. & Zimmermann, K.F., 2016. "Migration and the Demographic Shift," Handbook of the Economics of Population Aging, Elsevier.
    19. Ulf R. Hedetoft, 2013. "Social Inclusion: Inaugural Editorial," Social Inclusion, Cogitatio Press, vol. 1(1), pages 1-2.
    20. Fatica, Serena, 2011. "Preferences for redistribution, the size of government and the tax system," MPRA Paper 29782, University Library of Munich, Germany.
    21. Dotti, Valerio, 2016. "The political economy of immigration and population ageing," Working Papers 16-12, University of Mannheim, Department of Economics.
    22. Murard, Elie, 2017. "Less Welfare or Fewer Foreigners? Immigrant Inflows and Public Opinion towards Redistribution and Migration Policy," IZA Discussion Papers 10805, Institute for the Study of Labor (IZA).

    More about this item

    Keywords

    welfare; migration; international economics; politics;

    JEL classification:

    • F5 - International Economics - - International Relations, National Security, and International Political Economy
    • H1 - Public Economics - - Structure and Scope of Government
    • N3 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy

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