Battisti, M. , Felbermayr, G., Peri, G. and Poutvaara, P. (2018) Immigration, search and redistribution: a quantitative assessment of native welfare. Journal of the European Economic Association, 16(4), pp. 1137-1188. (doi: 10.1093/jeea/jvx035)
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Abstract
What are the welfare effects of immigration on low-skilled and high-skilled natives? To address this question, we develop a general equilibrium model featuring two skill types, search frictions, wage bargaining, and a welfare state that redistributes income through unemployment benefits and the provision of public goods. Our quantitative analysis suggests that, in all 20 countries studied, immigration attenuates the effects of search frictions. The resulting gains tend to outweigh the welfare costs of redistribution. Immigration has increased native welfare in almost all countries. In two-thirds of countries, both high- and low-skilled natives have benefited from the presence of immigrants, contrary to what models without search frictions or redistribution predict. Average total welfare gains from migration are 1.25% and 1.00% for high- and low-skilled natives, respectively. (JEL: F22, J61, J64)
| Item Type: | Articles |
|---|---|
| Additional Information: | Financial support by the Leibniz Association (SAW-2012-ifo-3) is gratefully acknowledged. |
| Status: | Published |
| Refereed: | Yes |
| Glasgow Author(s) Enlighten ID: | Battisti, Professor Michele |
| Authors: | Battisti, M., Felbermayr, G., Peri, G., and Poutvaara, P. |
| College/School: | College of Social Sciences > Adam Smith Business School > Economics |
| Journal Name: | Journal of the European Economic Association |
| Publisher: | Oxford University Press |
| ISSN: | 1542-4766 |
| ISSN (Online): | 1542-4774 |
| Published Online: | 21 November 2017 |
| Copyright Holders: | Copyright © 2017 The Authors |
| First Published: | First published in Journal of the European Economic Association 16(4):1137-1188 |
| Publisher Policy: | Reproduced in accordance with the copyright policy of the publisher |
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