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Migration and the Welfare StatePolitical-Economy Policy Formation$
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Assaf Razin, Efraim Sadka, and Benjarong Suwankiri

Print publication date: 2011

Print ISBN-13: 9780262016100

Published to MIT Press Scholarship Online: August 2013

DOI: 10.7551/mitpress/9780262016100.001.0001

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Is the Net Fiscal Burden a Good Measure of the Gains from Migration?

Is the Net Fiscal Burden a Good Measure of the Gains from Migration?

(p.117) 8 Is the Net Fiscal Burden a Good Measure of the Gains from Migration?
Migration and the Welfare State

Assaf Razin

Efraim Sadka

Benjarong Suwankiri

The MIT Press

The chapter studies whether net fiscal burden is a good indicator of the gains derived from migration. A simplified version of the overlapping-generations model is employed to study the gains from migration. The study also simplifies the analysis by assuming a fixed labor supply. The chapter examines the welfare implications of migration, explores how it impacts the welfare of the native population through fiscal balances in the economy and relative wages, and considers migration’s impact on social security benefits by assuming the production function to be linear. It also shows that the native population benefits from migration, despite net fiscal burden on the host country’s economy.

Keywords:   fiscal burden, fiscal balances, relative wages

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