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High Skilled Immigration Policy and Union Wage Setting

  • Moritz Bonn

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    This paper studies the effects of high skilled immigration on employment and net income in the host economy where the market for low skilled labor is distorted by union wage setting and a redistributive unemployment benefit scheme. I show that high skilled immigration can increase as well as decrease low skilled employment depending on how the public budget adjusts to immigration and that the effects on workers' net income levels may vary substantially. I conclude that a Pareto improvement can be achieved if the unemployment benefit level remains unaffected by high skilled immigration.

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    File URL: http://www.wiwi.uni-siegen.de/vwl/repec/sie/papers/147-11.pdf
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    Paper provided by Universität Siegen, Fakultät Wirtschaftswissenschaften, Wirtschaftsinformatik und Wirtschaftsrecht in its series Volkswirtschaftliche Diskussionsbeiträge with number 147-11.

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    Length: 19 pages
    Date of creation: 2011
    Date of revision: 27 Aug 2012
    Handle: RePEc:sie:siegen:147-11
    Contact details of provider: Postal: Hölderlinstr. 3, D - 57068 Siegen
    Phone: ++49 (0)271 740-3139
    Fax: ++49 (0)271 740-2590
    Web page: http://www.uni-siegen.de/fb5/vwl/research/diskussionsbeitraege/
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    1. Clemens Fuest & Marcel Thum, 1999. "Welfare Effects of Immigration in a Dual Labor Market," CESifo Working Paper Series 215, CESifo Group Munich.
    2. Alexander Kemnitz, 2008. "Native Welfare Losses from High Skilled Immigration," CESifo Working Paper Series 2409, CESifo Group Munich.
    3. Facchini, Giovanni & Mayda, Anna Maria, 2008. "From individual attitudes towards migrants to migration policy outcomes: Theory and evidence," CEPR Discussion Papers 6835, C.E.P.R. Discussion Papers.
    4. Giovanni Facchini & Anna Maria Mayda, 2007. "Does the Welfare State Affect Individual Attitudes towards Immigrants? Evidence Across Countries," Development Working Papers 233, Centro Studi Luca d\'Agliano, University of Milano.
    5. Francesc Ortega & Giovanni Peri, 2009. "The Causes and Effects of International Migrations: Evidence from OECD Countries 1980-2005," Working Papers 96, University of California, Davis, Department of Economics.
    6. Frederic DOCQUIER & Çaglar OZDEN & Giovanni PERI, 2010. "The Wage Effects of Immigration and Emigration," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2010044, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    7. Fuest, Clemens & Thum, Marcel, 2001. "Immigration and skill formation in unionised labour markets," European Journal of Political Economy, Elsevier, vol. 17(3), pages 557-573, September.
    8. O'Rourke, Kevin H. & Sinnott, Richard, 2006. "The determinants of individual attitudes towards immigration," European Journal of Political Economy, Elsevier, vol. 22(4), pages 838-861, December.
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