nep-mig New Economics Papers
on Economics of Human Migration
Issue of 2008‒05‒31
seven papers chosen by
Yuji Tamura
Australian National University

  1. Immigrants and Welfare Programmes: Exploring the Interactions between Immigrant Characteristics, Immigrant Welfare Dependence and Welfare Policy By Alan Barrett; Yvonne McCarthy
  2. Does Immigration Raise Natives’ Income? National and Regional Evidence from Spain By Amuedo-Dorantes, Catalina; de la Rica, Sara
  3. From individual attitudes towards migrants to migration policy outcomes: Theory and evidence By Facchini, Giovanni; Mayda, Anna Maria
  4. Mexican-American Entrepreneurship By Fairlie, Robert W.; Woodruff, Christopher
  5. Cultural Effects on Inbound Tourism into the USA: A Gravity Approach By Christoph Vietze
  6. Controversies about the Rise in American Inequality: A Survey By Dew-Becker, Ian; Gordon, Robert J
  7. Enhancing the Globalisation of Korea By Randall Jones; Taesik Yoon

  1. By: Alan Barrett (Economic and Social Research Institute (ESRI)); Yvonne McCarthy (The Central Bank & Financial Services Authority of Ireland)
    Abstract: The primary purpose of this paper is to provide a review of the papers within the economics literature that have examined the questions of immigrant welfare use and the responsiveness of immigrants to the incentives created by welfare systems. While our focus is largely on papers looking at the European case, we also draw on studies from the United States, in particular on issues where the European literature is thin. One set of papers asks whether immigrants who are more likely to use welfare are attracted to more generous welfare states. The results from these papers are not clear-cut. Another set of papers asks if immigrants use welfare more intensively than natives and if they assimilate out of or into welfare participation. In most cases, the unadjusted data shows higher use of welfare by immigrants although for some countries, for example Germany, this difference can be explained by differences in characteristics. Yet another set of papers finds that the rate of welfare use by existing migrants can influence the welfare use of newly arrived co-nationals. We illustrate some of these issues by looking at immigrant welfare use in Ireland and the UK. Immigrants in the UK appear to use welfare more intensively than natives but the opposite appears to be the case in Ireland.
    Keywords: Immigrants; welfare participation; Ireland; U.K.
    JEL: I38 J61
    Date: 2008–05
  2. By: Amuedo-Dorantes, Catalina (San Diego State University, California); de la Rica, Sara (University of the Basque Country)
    Abstract: How immigration affects the labor market of the host country is a topic of major concern for many immigrant-receiving nations. Spain is no exception following the rapid increase in immigrant flows experienced over the past decade. We assess the impact of immigration on Spanish natives’ income by estimating the net immigration surplus accruing at the national level and at high immigrant-receiving regions while taking into account the imperfect substitutability of immigrant and native labor. Specifically, using information on the occupational densities of immigrants and natives of different skill levels, we develop a mapping of immigrant-to-native self-reported skills that reveals the combination of natives across skills that would be equivalent to an immigrant of a given self-reported skill level, which we use to account for any differences between immigrant self-reported skill levels and their effective skills according to the Spanish labor market. We find that the immigrant surplus amounts to 0.04 percent of GDP at the national level and it is even higher for some of the main immigrant-receiving regions, such as Cataluña, Valencia, Madrid, and Murcia.
    Keywords: international migration, regional, national, immigration surplus, Spain
    JEL: J61 F22
    Date: 2008–05
  3. By: Facchini, Giovanni; Mayda, Anna Maria
    Abstract: In democratic societies individual attitudes of voters represent the foundations of policy making. We start by analyzing patterns in public opinion on migration and find that, across countries of different income levels, only a small minority of voters favour more open migration policies. Next we investigate the determinants of voters' preferences towards immigration from a theoretical and empirical point of view. Our analysis supports the role played by economic channels (labour market, welfare state, efficiency gains) using both the 1995 and 2003 rounds of the ISSP survey. The second part of the paper examines how attitudes translate into a migration policy outcome. We consider two alternative political-economy frameworks: the median voter and the interest groups model. On the one hand, the restrictive policies in place across destination countries and the very low fractions of voters favouring immigration are consistent with the median voter framework. At the same time, given the extent of individual-level opposition to immigration that appears in the data, it is somewhat puzzling, in a median-voter perspective, that migration flows take place at all. Interest-groups dynamics have the potential to explain this puzzle. We find evidence from regression analysis supporting both political-economy frameworks.
    Keywords: Immigration; Immigration Policy; Interest Groups; Median Voter; Political Economy
    JEL: F22 J61
    Date: 2008–05
  4. By: Fairlie, Robert W. (University of California, Santa Cruz); Woodruff, Christopher (University of California, San Diego)
    Abstract: Although business ownership has implications for income inequality, wealth accumulation and job creation, surprisingly little research explores why Mexican-Americans are less likely to start businesses and why the businesses that they start are less successful on average than non-Latino whites. We conduct a comprehensive analysis of Mexican-American entrepreneurship using microdata from the 2000 U.S. Census, the matched and unmatched March and Outgoing Rotation Group Files of the Current Population Survey from 1994 to 2004, and the Legalized Population Survey (LPS). We find that low levels of education and wealth explain the entire gap between Mexican immigrants and non-Latino whites in business formation rates. Nearly the entire gap in business income for Mexican immigrants is explained by low levels of education and limited English language ability. Using the natural experiment created by the Immigration Reform and Control Act (IRCA), we find that legal status represents an additional barrier for Mexican immigrants. A conservative estimate suggests that the lack of legal status reduces business ownership rates by roughly seven-tenths of a percentage point for both men and women. Human and financial capital deficiencies are found to limit business ownership and business success among second and third-generation Mexican-Americans, but to a lesser extent. These findings have implications for the debates over the selection of immigrants and the assimilation of Mexican-Americans in the U.S. economy.
    Keywords: Mexican-Americans, entrepreneurship, inequality
    JEL: J15 L26
    Date: 2008–05
  5. By: Christoph Vietze (Friedrich-Schiller University Jena, Department of Economics, Chair for Economic Policy)
    Abstract: In this paper we discuss the effects of cultural - and particular religious - factors on tourist flows into the USA as the world largest tourism destination. To estimate this empirically we run an augmented gravity equation. Our results give evidence that the gravity equation is an adequate instrument to explain variations in international tourist flows. With respect to the aim of the paper, we have found that cultural proximity between country of origin and country of destination have positive effects on the tourism flows between these countries. In particular, after controlling for a set of geographic variables, people from countries with the same language (English) and the same high governmental rankings like the USA, travel more into the USA for holiday than people from other countries. Above all, we have clear and stable evidence that tourists from Christian countries prefer the USA as holiday destination much stronger than people from other countries. This supports our argument that people wishing to go on holiday to countries with a similar cultural and political background.
    Keywords: tourism, cultural factors, religion
    JEL: F14 L83 Z12
    Date: 2008–05–19
  6. By: Dew-Becker, Ian; Gordon, Robert J
    Abstract: This paper provides a comprehensive survey of seven aspects of rising inequality that are usually discussed separately: changes in labor’s share of income; inequality at the bottom of the income distribution, including labor mobility; skill-biased technical change; inequality among high incomes; consumption inequality; geographical inequality; and international differences in the income distribution, particularly at the top. We conclude that changes in labor’s share play no role in rising inequality of labor income; by one measure labor’s income share was almost the same in 2007 as in 1950. Within the bottom 90 percent as documented by CPS data, movements in the 50-10 ratio are consistent with a role of decreased union density for men and of a decrease in the real minimum wage for women, particularly in 1980-86. There is little evidence on the effects of imports, and an ambiguous literature on immigration which implies a small overall impact on the wages of the average native American, a significant downward effect on high-school dropouts, and potentially a large impact on previous immigrants working in occupations in which immigrants specialize.The literature on skill-biased technical change (SBTC) has been valuably enriched by a finer grid of skills, switching from a two-dimension to a three- or five-dimensional breakdown of skills. We endorse the three-way “polarization” hypothesis that seems a plausible way of explaining differentials in wage changes and also in outsourcing. To explain increased skewness at the top, we introduce a three-way distinction between market-driven superstars where audience magnification allows a performance to reach one or ten million people, a second market-driven segment consisting of occupations like lawyers and investment bankers, and a third segment consisting of top corporate officers. Our review of the CEO debate places equal emphasis on the market in showering capital gains through stock options and an arbitrary management power hypothesis based on numerous non-market aspects of executive pay. Data on consumption inequality are too fragile to reach firm conclusions. We introduce two new issues, disparities in the growth of price indexes and also of life expectancy between the rich and the poor. We conclude with a perspective on international differences that blends institutional and market-driven explanations.
    Keywords: CEO Pay; Globalization; Immigration; Inequality; Labour Unions; Minimum Wage; Progressive Taxation; Skill-biased Technical Change; Super Stars
    JEL: D10 D31 D63 I12 I3 J10 J24 J51
    Date: 2008–05
  7. By: Randall Jones; Taesik Yoon
    Abstract: Globalisation through foreign direct investment (FDI), international trade and international movements of labour is a key force driving economic growth. Although Korea has become more integrated in the world economy over the past decade, it still ranks low in terms of import penetration, the stock of inward FDI relative to GDP and foreign workers as a share of the labour force. A number of policy reforms would help Korea make greater use of goods, services, capital and human resources from abroad: i) reducing barriers to FDI, including foreign ownership limits in some sectors; ii) focusing on attracting FDI by improving the business and living environment rather than through special zone schemes; iii) reducing import barriers, particularly in agriculture, through multilateral trade negotiations and WTO-consistent regional trade agreements; iv) relaxing product market regulations, notably in services; and v) easing controls on and facilitating the inflow of both low and high-skilled workers. <P>Renforcer la mondialisation de l’économie Coréenne <BR>La mondialisation, par le biais de l’investissement direct étranger (IDE), des échanges internationaux et de la circulation internationale de la main-d’oeuvre, est un facteur essentiel de croissance économique. Même si la Corée s’est intégrée davantage dans l’économie mondiale au cours de la décennie passée, elle est encore à la traîne du point de vue de la pénétration des importations, du stock d’IDE par rapport au PIB et de la proportion de travailleurs étrangers dans la population active. Un certain nombre de réformes aideraient la Corée à tirer meilleur parti des biens, des services, des capitaux et des ressources humaines d’origine étrangère : i) la réduction des obstacles à l’IDE, liés notamment au plafonnement des participations étrangères dans certains secteurs ; ii) une stratégie visant à attirer l’IDE, axée sur l’amélioration des conditions d’activité et de vie offertes aux investisseurs étrangers et non sur des systèmes de zones spéciales ; iii) la réduction des obstacles à l’importation, en particulier dans l’agriculture, par le biais de négociations commerciales multilatérales et d’accords commerciaux régionaux conformes aux règles de l’OMC ; iv) un assouplissement de la réglementation des marchés de produits, notamment dans les services ; et v) un assouplissement des contrôles limitant l’entrée de travailleurs aussi bien peu qualifiés que hautement qualifiés et la facilitation de l’accès de ces catégories.
    Keywords: globalisation, international trade, Korea, Corée, foreign direct investment, investissement direct étranger, trade liberalisation, mondialisation, merger and acquisition, fusion et acquisition, import penetration, pénétration des importations, agricultural trade, commerce agricole, immigration, immigration, foreign workers, échanges internationaux, libéralisation des échanges, service sector
    JEL: F1 F21 F22 F23
    Date: 2008–05–15

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