Immigration and the Future of the Welfare State in Europe

By: Alberto Alesina (Harvard University [Cambridge], IGIER) ; Johann Harnoss (UP1 – Université Panthéon-Sorbonne) ; Hillel Rapoport (PJSE – Paris Jourdan Sciences Economiques – UP1 – Université Panthéon-Sorbonne – ENS Paris – École normale supérieure – Paris – INRA – Institut National de la Recherche Agronomique – EHESS – École des hautes études en sciences sociales – ENPC – École des Ponts ParisTech – CNRS – Centre National de la Recherche Scientifique, PSE – Paris School of Economics)
We analyze the effect of immigration on attitudes to redistribution in Europe. Using data for 28 European countries from the European Social Survey, we .nd that native workers lower their support for redistribution if the share of immigration in their country is high. This effect is larger for individuals who hold negative views regarding immigration but is smaller when immigrants are culturally closer to natives and come from richer origin countries. The effect also varies with native workers’ and immigrants’ education. In particular, more educated natives (in terms of formal education but also job-specic human capital and ocupation task skill intensity) support more redistribution if immigrants are also relatively educated. To address endogeneity concerns, we restrict identification to within country and within country-occupation variation and also instrument immigration using a gravity model. Overall, our results show that the negative .First-order effect of immigration on attitudes to redistribution is relatively small and counterbalanced among skilled natives by positive second-order effects for the quality and diversity of immigration.

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