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

Matthew W. Peter and George Verikios

Centre of Policy Studies/IMPACT Centre Working Papers from Victoria University, Centre of Policy Studies/IMPACT Centre

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.

Keywords: immigration; residents' income; capital mobility; government equity; Berry-Soligo effect (search for similar items in EconPapers)
JEL-codes: D33 D60 F22 (search for similar items in EconPapers)
Date: 1995-05
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Published in The Australian Economic Review, vol. 29, iss. 2, 1996, pp. 171-88.

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https://www.copsmodels.com/ftp/workpapr/g-115.pdf Initial version, 1995-05 (application/pdf)
https://www.copsmodels.com/elecpapr/g-115.htm Local abstract: may link to additional material. (text/html)

Related works:
Journal Article: The Effect of Immigration on Residents' Incomes in Australia: Some Issues Reconsidered (1996)
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