Immigration and Secular Stagnation

Kaz Miyagiwa and Yoshiyasu Ono

ISER Discussion Paper from Institute of Social and Economic Research, The University of Osaka

Abstract: We examine the effect of immigration on the host-country economy in the dynamic model that can deal with secular unemployment. Immigration has contrasting effects, depending on the economic state of the host country. If it suffers from unemployment, an influx of immigrants worsens unemployment and decreases consumption by natives. If instead the host country has full employment, immigration boosts native consumption while maintaining full employment, provided that immigrants are not too numerous. An influx of too many immigrants however can trigger stagnation. We also find that immigrants’ remittances are harmful to natives under full employment but beneficial under secular stagnation.

Date: 2019-05
New Economics Papers: this item is included in nep-dge, nep-int and nep-mig
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Persistent link: https://EconPapers.repec.org/RePEc:dpr:wpaper:1054

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