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Immigration and the Canadian Welfare State 2011

Author

Listed:
  • Grubel, Herbert
  • Grady, Patrick

Abstract

This publication provides an estimate of the fiscal burden created by recent immigration into Canada and proposes reforms to existing immigrant selection policies to eliminate the burden. It uses a 2006 Census database to estimate the average incomes and taxes paid on these by immigrants who arrived in Canada over the period from 1987 to 2004. It also estimates other taxes they paid and the value of government services they absorbed. The study concludes that in the fiscal year 2005/06 the immigrants on average received an excess of $6,051 in benefits over taxes paid. Depending on assumptions about the number of recent immigrants in Canada, the fiscal burden in that year is estimated to be between $23.6 billion and $16.3 billion. These estimates are not changed by the consideration of other alleged benefits brought by immigrants. To curtail this growing fiscal burden from immigration, the study proposes that temporary work visas be granted to applicants who have a valid offer for employment from employers, in occupations and at pay levels specified by the federal government and determined in cooperation with private-sector employers. Immediate dependents may accompany successful applicants. The temporary visas are renewable and lead to landed immigrant status if certain specified employment criteria are met.

Suggested Citation

  • Grubel, Herbert & Grady, Patrick, 2011. "Immigration and the Canadian Welfare State 2011," MPRA Paper 31109, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:31109
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    References listed on IDEAS

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    1. Abbott, Michael & Beach, Charles M., 2009. "Immigrant Earnings Distributions and Earnings Mobility in Canada: Evidence for the 1982 Landing Cohort from IMDB Micro Data," CLSSRN working papers clsrn_admin-2009-22, Vancouver School of Economics, revised 13 Mar 2009.
    2. Picot, Garnett & Sweetman, Arthur, 2005. "The Deteriorating Economic Welfare of Immigrants and Possible Causes: Update 2005," Analytical Studies Branch Research Paper Series 2005262e, Statistics Canada, Analytical Studies Branch.
    3. Picot, Garnett, 2008. "Immigrant Economic and Social Outcomes in Canada: Research and Data Development at Statistics Canada," Analytical Studies Branch Research Paper Series 2008319e, Statistics Canada, Analytical Studies Branch.
    4. Pia M. Orrenius & Daniel Streitfeld, 2006. "TN Visas : a stepping stone toward a NAFTA labor market," Southwest Economy, Federal Reserve Bank of Dallas, issue Nov, pages 1-4.
    5. Morissette, Rene & Frenette, Marc, 2003. "Will They Ever Converge? Earnings of Immigrants and Canadian-born Workers over the Last Two Decades," Analytical Studies Branch Research Paper Series 2003215e, Statistics Canada, Analytical Studies Branch.
    6. Grady, Patrick, 2010. "Some Observations on Net Fiscal Transfers to Recent Immigrants Resulting From Income Taxes and Government Transfer Programs," MPRA Paper 24402, University Library of Munich, Germany.
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    Citations

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    Cited by:

    1. Grubel, Herbert & Grady, Patrick, 2012. "Fiscal transfers to immigrants in Canada: responding to critics and a revised estimate," MPRA Paper 37406, University Library of Munich, Germany, revised 06 Mar 2012.
    2. Kapsalis, Constantine, 2020. "The Fiscal Burden of Recent Immigrants to Canada," MPRA Paper 102505, University Library of Munich, Germany, revised 18 Aug 2020.
    3. Haozhen Zhang & Jianwei Zhong & Cédric de Chardon, 2020. "Immigrants’ net direct fiscal contribution: How does it change over their lifetime?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 53(4), pages 1642-1662, November.
    4. Grady, Patrick, 2012. "The parent and grandparent immigration program in Canada: costs and proposed changes," MPRA Paper 37289, University Library of Munich, Germany, revised 08 Mar 2012.
    5. Patrick, Grady, 2015. "An Assessment of the Impact of Conservative Immigration Reform on the Labour Market Performance of Immigrants," MPRA Paper 65529, University Library of Munich, Germany.
    6. Grady, Patrick, 2011. "A Critique of “Macroeconomic Impacts of Canadian Immigration… Using the Focus Model” (Dungan, Fang and Gunderson, 2010)," MPRA Paper 65454, University Library of Munich, Germany.

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    More about this item

    Keywords

    Canadian immigration; fiscal impacts of immigration to Canada; Immigration policy;
    All these keywords.

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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