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Immigration, Search, and Redistribution: A Quantitative Assessment of Native Welfare

Author

Listed:
  • Michele Battisti
  • Gabriel Felbermayr
  • Giovanni Peri
  • Panu Poutvaara
  • Gabriel J. Felbermayr

Abstract

We study the effects of immigration on native welfare in a general equilibrium model featuring two skill types, search frictions, wage bargaining, and a redistributive welfare state. Our quantitative analysis suggests that, in all 20 countries studied, immigration attenuates the effects of search frictions. These gains tend to outweigh the welfare costs of redistribution. Immigration has increased native welfare in almost all countries. Both high-skilled and low-skilled natives benefit in two thirds of countries, contrary to what models without search frictions predict. Average total gains from immigration are 1.25% and 1.00% for high and low skilled natives, respectively.

Suggested Citation

  • Michele Battisti & Gabriel Felbermayr & Giovanni Peri & Panu Poutvaara & Gabriel J. Felbermayr, 2014. "Immigration, Search, and Redistribution: A Quantitative Assessment of Native Welfare," CESifo Working Paper Series 5022, CESifo.
    • Handle: RePEc:ces:ceswps:_5022
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    More about this item

    Keywords

    immigration; search; labor market frictions; fiscal redistribution; cross-country comparisons;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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