In:
American Economic Review: Insights, American Economic Association, Vol. 2, No. 4 ( 2020-12-01), p. 527-542
Abstract:
We study the effects of welfare generosity on international migration using reforms of immigrant welfare benefits in Denmark. The first reform, implemented in 2002, lowered benefits for non-EU immigrants by about 50 percent, with no changes for natives or EU immigrants. The policy was later repealed and reintroduced. Based on a quasi-experimental research design, we find sizable effects: the benefit reduction reduced the net flow of immigrants by about 5,000 people per year, and the subsequent repeal of the policy reversed the effect almost exactly. The implied elasticity of migration with respect to benefits equals 1.3. This represents some of the first causal evidence on the welfare magnet hypothesis. (JEL F22, H53, I38, J15)
Type of Medium:
Online Resource
ISSN:
2640-205X
,
2640-2068
DOI:
10.1257/aeri.20190510
Language:
English
Publisher:
American Economic Association
Publication Date:
2020
detail.hit.zdb_id:
2957500-X
Permalink