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Immigration, Citizenship, and the Size of Government

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  • Ortega Francesc

    (Universitat Pompeu Fabra)

Abstract

I study the political sustainability of the welfare state in an environment where immigration is the main demographic force and where governments choose immigration policy. Voters anticipate their children's prospects of economic mobility and the future political consequences of today's policies. The skill distribution evolves due to intergenerational skill upgrading and immigration. I consider three regimes: permanent migration with citizenship granted by jus soli, permanent migration with jus sanguinis, and temporary migration. The main finding is that under permanent migration and jus soli there exists equilibria where redistribution is sustained indefinitely, despite constant skill upgrading. This is not the case in the other regimes. The crucial insight is that unskilled voters trade-off the lower wages from larger unskilled immigration with the increased political support for redistribution provided by the children of the current immigrants. These mechanisms are relevant for the ongoing debates over comprehensive immigration reform in the U.S, and elsewhere.

Suggested Citation

  • Ortega Francesc, 2010. "Immigration, Citizenship, and the Size of Government," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 10(1), pages 1-40, March.
    • Handle: RePEc:bpj:bejeap:v:10:y:2010:i:1:n:26
    DOI: 10.2202/1935-1682.2324
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    1. Francesc Ortega & Giovanni Peri, 2009. "The Causes and Effects of International Migrations: Evidence from OECD Countries 1980-2005," NBER Working Papers 14833, National Bureau of Economic Research, Inc.
    2. Roland Benabou & Efe A. Ok, 2001. "Social Mobility and the Demand for Redistribution: The Poum Hypothesis," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(2), pages 447-487.
    3. Card, David, 2001. "Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 22-64, January.
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    5. Simone Bertoli & Jesus Fernandez-Huertas Moraga & Francesc Ortega, 2011. "Immigration Policies and the Ecuadorian Exodus," The World Bank Economic Review, World Bank, vol. 25(1), pages 57-76, March.
    6. David Card, 2005. "Is the New Immigration Really so Bad?," Economic Journal, Royal Economic Society, vol. 115(507), pages 300-323, November.
    7. Ortega, Francesc & Peri, Giovanni, 2009. "The Causes and Effects of International Labor Mobility: Evidence from OECD Countries 1980-2005," MPRA Paper 19183, University Library of Munich, Germany.
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    14. Roc Armenter & Francesc Ortega, 2010. "Credible Redistributive Policies and Migration across US States," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 13(2), pages 403-423, April.
    15. Graziella Bertocchi & Chiara Strozzi, 2010. "The Evolution of Citizenship: Economic and Institutional Determinants," Journal of Law and Economics, University of Chicago Press, vol. 53(1), pages 95-136, February.
    16. Francesc Ortega & Giovanni Peri, 2009. "The Causes and Effects of International Migrations: Evidence from OECD Countries 1980-2005," NBER Working Papers 14833, National Bureau of Economic Research, Inc.
    17. Gordon H. Hanson & Kenneth Scheve & Matthew J. Slaughter, 2007. "Public Finance And Individual Preferences Over Globalization Strategies," Economics and Politics, Wiley Blackwell, vol. 19(1), pages 1-33, March.
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    20. Francesc Ortega & Ryuichi Tanaka, 2007. "Gender specialization in households: An empirical analysis," Economics Working Papers 1021, Department of Economics and Business, Universitat Pompeu Fabra.
    21. Alessandro Lizzeri & Nicola Persico, 2004. "Why did the Elites Extend the Suffrage? Democracy and the Scope of Government, with an Application to Britain's "Age of Reform"," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(2), pages 707-765.
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    More about this item

    Keywords

    immigration; citizenship; redistribution;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • I2 - Health, Education, and Welfare - - Education
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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