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Ethnic enclaves and welfare cultures - quasi-experimental evidence

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  • Åslund, Olof

    () (IFAU - Institute for Labour Market Policy Evaluation)

  • Fredriksson, Peter

    () (Nationalekonomiska institutionen)

Abstract

We examine peer effects in welfare use among immigrants to Sweden by exploiting a governmental refugee placement policy. We distinguish between the quantity of contacts – the number of individuals of the same ethnicity – and the quality of contacts – welfare use among members of the ethnic group. OLS regressions suggest that both these factors are positively related to individual welfare use. Instrumental variables estimations yield the conclusion that only the quality of contacts matter. An increase of the fraction of the ethnic group on welfare by 10 percent raises the individual probability of welfare use by almost 7 percent.

Suggested Citation

  • Åslund, Olof & Fredriksson, Peter, 2005. "Ethnic enclaves and welfare cultures - quasi-experimental evidence," Working Paper Series 2005:8, IFAU - Institute for Evaluation of Labour Market and Education Policy.
  • Handle: RePEc:hhs:ifauwp:2005_008
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    References listed on IDEAS

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    1. Per-Anders Edin & Peter Fredriksson & Olof Åslund, 2004. "Settlement policies and the economic success of immigrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 17(1), pages 133-155, February.
    2. Per-Anders Edin & Peter Fredriksson & Olof Åslund, 2003. "Ethnic Enclaves and the Economic Success of Immigrants—Evidence from a Natural Experiment," The Quarterly Journal of Economics, Oxford University Press, vol. 118(1), pages 329-357.
    3. James Heckman & Edward Vytlacil, 1998. "Instrumental Variables Methods for the Correlated Random Coefficient Model: Estimating the Average Rate of Return to Schooling When the Return is Correlated with Schooling," Journal of Human Resources, University of Wisconsin Press, vol. 33(4), pages 974-987.
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    5. Wooldridge, Jeffrey M., 2003. "Further results on instrumental variables estimation of average treatment effects in the correlated random coefficient model," Economics Letters, Elsevier, vol. 79(2), pages 185-191, May.
    6. Lawrence F. Katz & Jeffrey R. Kling & Jeffrey B. Liebman, 2001. "Moving to Opportunity in Boston: Early Results of a Randomized Mobility Experiment," The Quarterly Journal of Economics, Oxford University Press, vol. 116(2), pages 607-654.
    7. Per-Anders Edin & Robert J. LaLonde & Olof Aslund, 2000. "Emigration of Immigrants and Measures of Immigrant Assimilation: Evidence from Sweden," Working Papers 0020, Harris School of Public Policy Studies, University of Chicago.
    8. Edin, P.-A. & Fredriksson, P., 2000. "LINDA - Longitudinal INdividual DAta for Sweden," Papers 2000:19, Uppsala - Working Paper Series.
    9. Lindbeck, Assar, 1997. "Incentives and Social Norms in Household Behavior," American Economic Review, American Economic Association, vol. 87(2), pages 370-377, May.
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    Citations

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    Cited by:

    1. Olof Åslund & John Östh & Yves Zenou, 2010. "How important is access to jobs? Old question--improved answer," Journal of Economic Geography, Oxford University Press, vol. 10(3), pages 389-422, May.
    2. Per Engstrom & Bertil Holmlund, 2009. "Tax evasion and self-employment in a high-tax country: evidence from Sweden," Applied Economics, Taylor & Francis Journals, vol. 41(19), pages 2419-2430.
    3. Devillanova, Carlo, 2008. "Social networks, information and health care utilization: Evidence from undocumented immigrants in Milan," Journal of Health Economics, Elsevier, vol. 27(2), pages 265-286, March.
    4. Delia Furtado & Nikolaos Theodoropoulos, 2009. "Intermarriage and Immigrant Employment: The Role of Networks," CReAM Discussion Paper Series 0906, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    5. Lindbeck, Assar & Palme, Mårten & Persson, Mats, 2007. "Social Interaction and Sickness Absence," Working Paper Series 725, Research Institute of Industrial Economics.
    6. Nekby, Lena & Özcan, Gülay, 2007. "Do Domestic Educations Even Out the Playing Field? Ethnic Labor Market Gaps in Sweden," SULCIS Working Papers 2007:3, Stockholm University, Linnaeus Center for Integration Studies - SULCIS.
    7. Kahanec, Martin & Zimmermann, Klaus F., 2008. "Migration in an Enlarged EU: A Challenging Solution?," IZA Discussion Papers 3913, Institute for the Study of Labor (IZA).
    8. Hallberg, Daniel, 2006. "Cross-national differences in income poverty among Europe´s 50+," Working Paper Series 2006:14, Uppsala University, Department of Economics.
    9. Johansson, Fredrik & Klevmarken, Anders, 2006. "Explaining the size and nature of response in a survey on health status and economic standard," Working Paper Series 2006:2, Uppsala University, Department of Economics.
    10. Martin Gonzalez Eiras & Dirk Niepelt, 2004. "Sustaining Social Security," Working Papers 72, Universidad de San Andres, Departamento de Economia, revised Jun 2004.
    11. Galster, George & Andersson, Roger & Musterd, Sako & Kauppinen, Timo M., 2008. "Does neighborhood income mix affect earnings of adults? New evidence from Sweden," Journal of Urban Economics, Elsevier, vol. 63(3), pages 858-870, May.
    12. Aparicio Fenoll, Ainhoa, 2011. "Network Effects on Migrants' Remittances," IZA Discussion Papers 5657, Institute for the Study of Labor (IZA).
    13. Thomas Andrén & Daniela Andrén, 2013. "Never give up? The persistence of welfare participation in Sweden," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-21, December.
    14. Berg, Lennart & Berger, Tommy, 2005. "The Q theory and the Swedish housing market –an empirical test," Working Paper Series 2005:19, Uppsala University, Department of Economics.
    15. George Galster & Lina Hedman, 2013. "Measuring Neighbourhood Effects Non-experimentally: How Much Do Alternative Methods Matter?," Housing Studies, Taylor & Francis Journals, vol. 28(3), pages 473-498, April.
    16. Gee Emily R. & Giuntella G. Osea, 2011. "Medicaid and Ethnic Networks," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-31, December.

    More about this item

    Keywords

    Ethnic enclaves; welfare use; immigrants;

    JEL classification:

    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy

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