Exploratory: Sustainable Cities for Citizens

Will immigration make Europeans less supportive of redistribution policies and, eventually, threaten the future of the Welfare State in Europe? To answer this question, Alberto Alesina, Elie Murard and Hillel Rapoport collected data on immigration stocks and on attitudes to redistribution in 140 regions of 16 Western European countries (in the years 2000 and 2010). Holding the analysis at the regional level allows them to introduce country-year fixed effects in their pooled cross-sectional regressions, thereby controlling for welfare and redistribution policies set at the national level that can potentially create “welfare-magnet effects”.

The authors demonstrate that there are lower levels of support for redistribution when the share of immigrants in a region is higher. This negative association is statistically and economically significant, comparable to the effect of individual variables such as education or income that are important determinants of preferences for redistribution. Their results are quite heterogeneous along many dimensions, that is, they depend on the type of respondents, the type of receiving countries, and the type of immigrants considered. The most important dimension of individual heterogeneity is political affiliation. The anti-redistribution response to immigration is almost entirely driven by individuals at the center or the right of the political spectrum who hold negative views about immigrants or think immigrants should not be entitled to welfare benefits. Immigrants from the Middle-East and North-Africa as well as from Eastern Europe generate larger anti-redistribution responses (about three times more negative) while more skilled immigrants have a milder anti-redistribution effect. Finally, the negative association between immigration and support for redistribution is significantly stronger in host countries with larger Welfare States (e.g., the Nordic countries and France, in contrast to the UK or Ireland). Also, there seems to be a change of regime in the few regions where the share of foreign-born is larger than 20% (the Swiss regions, and capital-regions such as Brussels, Paris or London). Those regions seem to experience a virtuous circle between the characteristics of (richer and more educated) natives and of (more geographically diverse and educated) immigrants, making the negative association between immigration and preferences for redistribution virtually undetectable.

The authors conclude that immigration can therefore represent a threat to social solidarity in Europe and endanger the future of the Welfare State. However, there is no fatality in this conclusion because their study also suggests that more selective immigration policies, favoring high-skill immigration from a larger set of origin countries, can serve as a mitigating factor.

Written by: Alberto Alesina, Elie Murard, Hillel Rapoport*

* PSE Member

References

Original title of the article: Immigration and Preferences for Redistribution in Europe

Published in: CEPR Discussion Paper No 14211, December 2019

Available at: https://cepr.org/active/publications/discussion_papers/dp.php?dpno=14211

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