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The Effects of Immigration on Residents' Incomes in Australia: Some Issues Reconsidered

Author

Listed:
  • Matthew W. Peter
  • George Verikios

Abstract

This paper outlines the standard neoclassical model (SNM) of the impact of immigration on the incomes of the resident (pre-immigration) population. We augment the SNM to allow for foreign ownership of and government equity in the capital stock. Using the expanded model, four back-of-the-envelope (BOTE) calculations are made. The calculations reveal that the size of the Berry-Soligo welfare triangle is small and is dominated by the effects of foreign ownership of capital and government equity in capital. In our preferred scenario, the BOTE calculation indicates that the 1991-92 Australian immigrant intake reduced residents' income. We believe the results of the BOTE calculations justify a more comprehensive study incorporating a range of other influential factors determining the impact of immigration on residents' income. We suggest a list of such factors and report on work done in these specific areas. Essential to a comprehensive study are the integration of results from studies in specific areas, and the devotion of resources to the tasks of further data collection and model development.

Suggested Citation

  • Matthew W. Peter & George Verikios, 1995. "The Effects of Immigration on Residents' Incomes in Australia: Some Issues Reconsidered," Centre of Policy Studies/IMPACT Centre Working Papers g-115, Victoria University, Centre of Policy Studies/IMPACT Centre.
  • Handle: RePEc:cop:wpaper:g-115
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    References listed on IDEAS

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    1. Pope, David & Withers, Glenn, 1993. "Do Migrants Rob Jobs? Lessons of Australian History, 1861–1991," The Journal of Economic History, Cambridge University Press, vol. 53(04), pages 719-742, December.
    2. Clarke, Harry R & Ng, Yew-Kwang, 1993. "Immigration and Economic Welfare: Resource and Environmental Aspects," The Economic Record, The Economic Society of Australia, vol. 69(206), pages 259-273, September.
    3. Berry, R Albert & Soligo, Ronald, 1969. "Some Welfare Aspects of International Migration," Journal of Political Economy, University of Chicago Press, vol. 77(5), pages 778-794, Sept./Oct.
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    Citations

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    Cited by:

    1. Jaai Parasnis & Dietrich Fausten & Russell Smyth, 2006. "The Impact of Immigration on Native Workers in Australia," Monash Economics Working Papers archive-40, Monash University, Department of Economics.
    2. Jaai Parasnis, 2010. "Estimating The Relationship Between Immigrant And Native Workers In Australia: A Production Theory Approach," Australian Economic Papers, Wiley Blackwell, vol. 49(1), pages 73-85, March.
    3. Daina McDonald, 2006. "150 Issues of The Australian Economic Review: The Changing Face of a Journal over Time," Melbourne Institute Working Paper Series wp2006n01, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.

    More about this item

    Keywords

    immigration; residents' income; capital mobility; government equity; Berry-Soligo effect;

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution
    • D60 - Microeconomics - - Welfare Economics - - - General

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