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Lowering Welfare Benefits: Intended and Unintended Consequences for Migrants and their Families

Author

Listed:
  • Lars Højsgaard Andersen
  • Christian Dustmann

    (Department of Economics, University College London and CReAM)

  • Rasmus Landersø

    (ROCKWOOL Foundation Research Unit)

Abstract

Denmark's Start Aid welfare reform reduced benefits to refugee immigrants by around 50 percent for those granted residency after the reform date. The reform led to a sharp short run increase in labor earnings and employment, but it also induced a strong female labor force withdrawal, and a large and persistent drop in disposable income for most households. Furthermore, the reform caused a sharp increase in property crime among both females and males. Moreover, children's likelihood of being enrolled in childcare or preschool, their performance in language tests, and their years of education all decreased, while teenagers' crime rates increased.

Suggested Citation

  • Lars Højsgaard Andersen & Christian Dustmann & Rasmus Landersø, 2019. "Lowering Welfare Benefits: Intended and Unintended Consequences for Migrants and their Families," RF Berlin - CReAM Discussion Paper Series 1905, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    • Handle: RePEc:crm:wpaper:1905
    as

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    File URL: https://www.cream-migration.org/publ_uploads/CDP_05_19.pdf
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Francesco Fasani & Tommaso Frattini & Maxime Pirot, 2023. "From Refugees to Citizens: Labor Market Returns to Naturalization," Development Working Papers 489, Centro Studi Luca d'Agliano, University of Milano, revised 11 Jun 2024.
    2. Anne Sofie Tegner Anker & Lars H. Andersen & Christopher Wildeman, 2020. "Estimating and explaining ethnic disparities in the cumulative risk of paternal incarceration in Denmark," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 43(22), pages 617-658.
    3. Foged, Mette & Hasager, Linea & Peri, Giovanni & Arendt, Jacob Nielsen & Bolvig, Iben, 2023. "Intergenerational spillover effects of language training for refugees," Journal of Public Economics, Elsevier, vol. 220(C).
    4. Black, Sandra E. & Liepmann, Hannah & Remigereau, Camille & Spitz-Oener, Alexandra, 2022. "Government aid and child refugees’ economic success later in life: Evidence from post-WWII GDR refugees," Labour Economics, Elsevier, vol. 75(C).
    5. Jacob Nielsen Arendt & Iben Bolvig & Mette Foged & Linea Hasager & Giovanni Peri, 2020. "Language Training and Refugees' Integration," NBER Working Papers 26834, National Bureau of Economic Research, Inc.
    6. Jacob Nielsen Arendt, 2022. "Labor market effects of a work-first policy for refugees," Journal of Population Economics, Springer;European Society for Population Economics, vol. 35(1), pages 169-196, January.
    7. Martin Guzi & Martin Kahanec & Magdalena M. Ulceluse, 2021. "Europe's migration experience and its effects on economic inequality," Discussion Papers 60, Central European Labour Studies Institute (CELSI).
    8. Qi, Haodong & Irastorza, Nahikari & Emilsson, Henrik & Bevelander, Pieter, 2019. "Does Integration Policy Integrate? The Employment Effects of Sweden's 2010 Reform of the Introduction Program," IZA Discussion Papers 12594, Institute of Labor Economics (IZA).
    9. Frederik Thuesen & Vibeke Jakobsen & Nina T. Dalgaard & Bjørn C. A. Viinholt, 2020. "PROTOCOL: Interventions to improve the economic self‐sufficiency of unemployed immigrants from non‐Western countries," Campbell Systematic Reviews, John Wiley & Sons, vol. 16(4), December.
    10. Rabbani, Maysam, 2024. "Dollars and megabits: A comparative analysis of Telecom and Healthcare Connect Fund," Information Economics and Policy, Elsevier, vol. 67(C).
    11. Manasi Deshpande & Michael G. Mueller-Smith, 2022. "Does Welfare Prevent Crime? The Criminal Justice Outcomes of Youth Removed From SSI," NBER Working Papers 29800, National Bureau of Economic Research, Inc.
    12. Heinz, Matthias & Friebel, Guido & Pasch, Stefan & Sabet, Navid, 2023. "The 30 Years' War and Violent Crime in the Late 19th Century," Journal of Economic Behavior & Organization, Elsevier, vol. 208(C), pages 191-202.
    13. Matilda Kilström & Birthe Larsen & Elisabet Olme, 2023. "Temporary refugee protection and labor-market outcomes," Empirical Economics, Springer, vol. 65(4), pages 1895-1929, October.

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    More about this item

    Keywords

    Social assistance; welfare state; labor market outcomes; migration;
    All these keywords.

    JEL classification:

    • E64 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Incomes Policy; Price Policy
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General

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