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Taxes and Migration Flows: Preferential Tax Schemes for High-Skill Immigrants

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  • Sousa, Joao
  • Teles, Pedro

Abstract

We study preferential tax schemes for high-skill immigrants such as those adopted in Europe in the past two decades. The overall assessment is negative. While they induce a very large immigration surplus tilted towards the low-skill, they may also give rise to an emigration deficit that more than offsets the surplus. The unilateral adoption is ambiguous in its welfare effects for both high- and low- skill workers, but the multilateral adoption is unambiguous in redistributing from low-skill to high-skill workers.

Suggested Citation

  • Sousa, Joao & Teles, Pedro, 2023. "Taxes and Migration Flows: Preferential Tax Schemes for High-Skill Immigrants," CEPR Discussion Papers 18414, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:18414
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    1. Jacopo Bassetto & Giuseppe Ippedico, 2023. "Can Tax Incentives Bring Brains Back? Returnees Tax Schemes and High-Skilled Migration in Italy," CESifo Working Paper Series 10271, CESifo.
    2. Henrik Jacobsen Kleven & Camille Landais & Esben Schultz, 2014. "Migration and Wage Effects of Taxing Top Earners: Evidence from the Foreigners' Tax Scheme in Denmark," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(1), pages 333-378.
    3. Marco Manacorda & Alan Manning & Jonathan Wadsworth, 2012. "The Impact Of Immigration On The Structure Of Wages: Theory And Evidence From Britain," Journal of the European Economic Association, European Economic Association, vol. 10(1), pages 120-151, February.
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    More about this item

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration

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