Immigration to the Land of Redistribution

Tito Boeri

No 4273, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Negative perceptions about migrants in Europe, the Continent with the largest social policy programmes, are driven by concerns that foreigners are a net fiscal burden. Paradoxically instruments of social inclusion are becoming a weapon of mass exclusion. Increasing concerns of public opinion are indeed pressing Governments, in the midst of the recession, to reduce welfare access by migrants or further tighten migration policies. Are there politically feasible alternatives to these two hardly enforceable (and procyclical) policy options? In this paper we look at economic and cultural determinants of negative perceptions about migrants in Europe. Based on a simple model of the perceived fiscal effects of migration and on a largely unexploited database (EU-Silc), we find no evidence that legal migrants, notably skilled migrants, are net recipients of transfers from the state. However, there is evidence of "residual dependency" on non-contributory transfers and self-selection of migrants more likely to draw on welfare in the countries with the most generous welfare state. Moreover, redistribution does not find much support among those who are in favour of immigration. A way out of the migration into the welfare state dilemma facing Europe involves i. co-ordinating safety nets across the EU, ii. adopting explicitly selective migration policies, and iii. improving activation programmes. Other options – such as restricting migration or welfare access by migrants – are however on the agenda of national Governments.

Keywords: fiscal externality; welfare access; migration policy (search for similar items in EconPapers)
JEL-codes: J38 J5 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2009-06
New Economics Papers: this item is included in nep-eec and nep-mig
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Published - published in: Economica, 2010, 77 (308), 651-687

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Related works:
Journal Article: Immigration to the Land of Redistribution (2010)
Working Paper: Immigration to the Land of Redistribution (2010)
Working Paper: Immigration to the land of redistribution (2009)
Working Paper: Immigration to the Land of Redistribution (2009)
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