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Self-Confirming Immigration Policy

  • Paolo E. Giordani
  • Michele Ruta

We study immigration policy in a small receiving economy under self-selection of migrants. We show that a non-discriminatory immigration policy choice affects and is affected by the migratory decisions of skilled and unskilled foreign workers. From this interaction multiple equilibria may arise, which are driven by the natives’ expectations on the welfare effects of immigration. In particular, pessimistic (optimistic) beliefs induce a country to impose higher (lower) barriers to immigration, which crowd out (crowd in) skilled migrants and thus confirm initial beliefs. This self-fulfilling mechanism sustains the endogenous formation of an anti or pro-immigration prejudice. We discuss how the adoption of a skill-selective policy affects this result.

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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 3762.

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Date of creation: 2012
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Handle: RePEc:ces:ceswps:_3762
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  1. Hatton, Timothy J. & Williamson, Jeffrey G., 2004. "International Migration in the Long-Run: Positive Selection, Negative Selection and Policy," IZA Discussion Papers 1304, Institute for the Study of Labor (IZA).
  2. Giovanni Facchini & Anna Maria Mayda, 2008. "From individual attitudes towards migrants to migration policy outcomes: Theory and evidence," Economic Policy, CEPR;CES;MSH, vol. 23, pages 651-713, October.
  3. Giovanni Facchini & Anna Maria Mayda, 2006. "Individual Attitudes towards Immigrants: Welfare-State Determinants Across Countries," Working Papers gueconwpa~06-06-02, Georgetown University, Department of Economics.
  4. Paolo E. Giordani & Michele Ruta, 2011. "Coordination Failures in Immigration Policy," Working Papers CELEG 1101, Dipartimento di Economia e Finanza, LUISS Guido Carli.
  5. Jeffrey Grogger & Gordon H. Hanson, 2008. "Income Maximization and the Selection and Sorting of International Migrants," NBER Working Papers 13821, National Bureau of Economic Research, Inc.
  6. George J. Borjas, 1987. "Self-Selection and the Earnings of Immigrants," NBER Working Papers 2248, National Bureau of Economic Research, Inc.
  7. Kevin H. O'Rourke & Richard Sinnott, 2004. "The Determinants of Individual Attitudes Towards Immigration," Trinity Economics Papers 20042, Trinity College Dublin, Department of Economics.
  8. Giorgio Bellettini & Carlotta Berti Ceroni, 2007. "Immigration Policy, Self-selection, and the Quality of Immigrants," Review of International Economics, Wiley Blackwell, vol. 15(5), pages 869-877, November.
  9. Levine, David & Fudenberg, Drew, 2006. "Superstition and Rational Learning," Scholarly Articles 3196330, Harvard University Department of Economics.
  10. Jim Dolmas & Gregory W. Huffman, 1998. "On the political economy of immigration and income redistribution," Working Papers 9804, Federal Reserve Bank of Dallas.
  11. Benhabib, Jess, 1996. "On the political economy of immigration," European Economic Review, Elsevier, vol. 40(9), pages 1737-1743, December.
  12. Belot, Michèle & Hatton, Timothy J., 2008. "Immigrant Selection in The OECD," CEPR Discussion Papers 6675, C.E.P.R. Discussion Papers.
  13. Cohen, Alon & Razin, Assaf, 2008. "The Skill Composition of Immigrants and the Generosity of the Welfare State: Free vs. Policy-Controlled Migration," CEPR Discussion Papers 7034, C.E.P.R. Discussion Papers.
  14. de Melo, Jaime & Grether, Jean-Marie & Müller, Tobias, 2001. "The Political Economy of International Migration in a Ricardo-Viner Model," CEPR Discussion Papers 2714, C.E.P.R. Discussion Papers.
  15. Facchini, Giovanni & Willmann, Gerald, 2005. "The political economy of international factor mobility," Journal of International Economics, Elsevier, vol. 67(1), pages 201-219, September.
  16. McKenzie, David & Rapoport, Hillel, 2007. "Self-selection patterns in Mexico-U.S. migration : the role of migration networks," Policy Research Working Paper Series 4118, The World Bank.
  17. Timothy J. Hatton & Jeffrey G. Williamson, 2008. "Global Migration and the World Economy: Two Centuries of Policy and Performance," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262582775, June.
  18. Paolo E Giordani & Michele Ruta, 2008. "Prejudice and Immigration," Levine's Working Paper Archive 122247000000002276, David K. Levine.
  19. 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, June.
  20. Ortega, Francesc, 2005. "Immigration quotas and skill upgrading," Journal of Public Economics, Elsevier, vol. 89(9-10), pages 1841-1863, September.
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