IMMIGRATION POLICY, CULTURAL PLURALISM AND TRADE: EVIDENCE FROM THE WHITE AUSTRALIA POLICY

Abstract.   Examining data for Australia and 101 trading partners that span the years 1989–2000, we find immigrants from nations afforded preference under the White Australia policy exert greater proportional influences on Australian imports from their home countries compared to immigrants from nations not privy to such preference. Immigrants from this latter group of countries influence Australian exports to their home countries proportionally more than do immigrants from the former group. We also find immigrant-trade links vary across disaggregated measures of trade. The results suggest that cultural diversity, affected here by immigration policy, is relevant to a nation's trade patterns.     

Immigrants and the Use of Government Transfer Payments

This article examines the use of government benefits and allowances by Australian immigrants relative to their native-born counterparts. The study extends the Australian literature by employing micro-level (Australian Longitudinal Survey) data, controlling for a number of relevant variables including first or second generation immigrant status and the nature of transfer payments received. The data on young adults employed in the study provide a comparable population for examining the relative use of benefits among those of similar age, allowing comparisons based on only the relevant types of benefits. The results consistently reject the hypothesis that immigrants are disproportionately using benefit payments and thereby imposing a burden on public funds. These results are of interest, especially since Australia is already a major immigrant-receiving country, and since the Australian welfare system is more extensive in its coverage than most other immigrant-receiving countries.     

The impact of welfare benefits on natives' and immigrants' attitudes toward immigration

We investigate the effect of the relative welfare dependence of immigrants on attitudes toward further immigration of different groups of the population in a pooled cross-section of 24 European countries for the 2004–2010 period. Explicitly controlling for the dependence of immigrants and natives on welfare benefits we find that in countries with higher take-up rates among immigrants relative to natives pro-immigration attitudes, very robustly, increase more strongly with increasing educational attainment and, slightly less robustly, decline more strongly with the age of natives. Within the group of immigrants, by contrast, the impact of age on pro-immigration attitudes is more favorable with increasing relative benefit take-up of immigrants.     

The Fiscal Impact of Immigrants in Austria – A Generational Accounting Analysis

In this paper, we employ generational accounting to analyse the inter-temporal stance of Austrian public finance in 1998 as well as the inter-temporal fiscal impact of immigration to Austria. Immigrants affect inter-temporal fiscal balance in essentially two ways. Firstly, they have a demographic effect in enlarging the population (and thus the tax base) and in altering its age- (and gender-) composition. Secondly, they change the fiscal characteristics of age cohorts due to a representative immigrant exhibiting higher or lower tax and transfer payments than a representative native of the same age and gender. The overall fiscal effect of immigration is found positive, under the assumption that the age and fiscal characteristics of future immigrants resemble those of the current immigrant population in Austria. This is due to a favourable age composition and lower per capita net transfer receipts during retirement age, which compensate for lower per capita net tax payments during working age. However, immigration is not likely to achieve inter-temporal fiscal balance, even if immigration increases or migrants are screened by skill or age.     

Fiscal Implications of Immigration—A Net Present Value Calculation

Focusing on the net fiscal effects, the gain from admitting immigrants is computed for a welfare state with large expenditures and a large tax burden (Sweden). Prices and behavior are held constant, which allows a detailed analysis of the effects of immigration. The present value of future tax revenues minus outlays is potentially large; USD 23,500 per young working‐age immigrant, but an average new immigrant represents a net government loss of USD 20,500. The dominant factors are employment rates and age. For young working‐age immigrants, the “break‐even” participation rate for which the gain would be zero is 60%, well below the empirical rate for this group.     

Immigrants’ net direct fiscal contribution: How does it change over their lifetime?

Life-cycle direct public fiscal contributions and transfers are studied using longitudinal income tax data from 1982 to 2016 and administrative files for immigrants landed in Canada from 1980 to 2016. Relative to a comparison group comprising the Canadian-born and immigrants landed before 1980, immigrants since 1980 have a lower average net direct fiscal contribution (NDFC) during their working years due to their lower taxes and social security contributions but a higher average NDFC after 65 years of age because of reduced public pension eligibility and entitlement. Immigrants who landed at younger than 19 years old have much higher direct fiscal contributions than other age-at-arrival groups and reach their peak of contributions around 10 years earlier in life than other age-at-arrival groups. Immigrants whose age at arrival is above 65 have a less negative average NDFC than other age-at-arrival groups over the above-65 life cycle. These life-cycle age𠄁at-arrival trajectories are stable for immigrants in different landing cohorts. We apply the life-cycle estimates to project the present discounted value of lifetime NDFCs for immigrants who landed in 2016. For each landing age group, refugees and family class immigrants have negative or zero average present values of life-cycle NDFCs, much below that of economic immigrants.     

Global labour markets,return, and onward migration

Abstract. There is increasing evidence that international migration is characterized by frequent return and onward migration. This has important consequences for the contribution of immigrants to the economy of the host country. Lack of longitudinal data has prevented much analysis of how frequently international migration involves a sequence of location decisions or how long the typical migrant stays in a host country. A newly available longitudinal data set covering all immigrants to Canada since 1980 provides the opportunity to address these issues. The results show that a large fraction of male immigrants who are of working age, especially among skilled workers and entrepreneurs, are highly internationally mobile.     

Immigration and Its Impact on the Incidence of Training in Australia

Critics of immigration often argue that by providing a cheap alternative to training, immigration acts as a disincentive for employers to invest in training. Immigration, therefore, may be partly responsible for Australia's poor record in the area of industry training. This article evaluates this argument using data recently collected by the ABS.
Probit models explaining the determinants of three types of training—in-house, external and on-the-job—are estimated for the Australian-born workforce. These models are then augmented with a variable representing the impact of skilled immigration. Initial estimates indicated that immigration was significantly and inversely associated with the probability of Australian-born workers receiving in-house training.
This inverse association, however, may result not because employers hire skilled immigrants in preference to providing training, but because skilled immigrants are over-represented in low training industries. A two-step procedure, involving first identifying the size of industry fixed effects on training and then isolating the impact of immigration on these fixed effects, confirms that it is industry-specific effects which are of most importance. It is concluded, therefore, that immigration is currently not displacing any training activities in Australia.     

Immigration, Language and Multiculturalism in Australia

This paper uses a unique survey on multiculturalism in Australia to explore attitudes towards immigration and multiculturalism. The ethnic backgrounds of immigrants are shown not to matter as long as immigrants are perceived as wanting to become Australian, rather than remaining apart. Australians support government programs to assist the adjustment process, but oppose programs that encourage distinct language and cultural maintenance or foster linguistic/ethnic concentrations. The apprehension that Australians have towards multiculturalism is that they see it as a mechanism for separate cultural preservation. Linguistic enclaves are shown to reduce the acquisition of English language skills among immigrants, whereas positive attitudes among immigrants towards Australia are associated with greater proficiency in speaking, reading and writing English.     

Is the new immigration less skilled than the old?

This paper analyzes trends in the skills of immigrants to the US in the post-World War II period. Changes in the supply, demand, and institutional factors determining immigration are analyzed for their implications for immigrant skills. During the past 4 decades immigration has shifted from being predominantly European and Canadian in origin to being predominantly Asian and Latin American, and there have been changes in the criteria for rationing immigration visas. Immigrant skills can be analyzed within the context of a model of the supply of immigrants and the US demand for immigrants. Of the Asian immigrants subject to numerical limitation, the proportion who were occupational preference principals declined from 18.2% in 1970, to 11.9% in 1975, to 8.1% in 1981. A growing stock of the foreign-born population who are illegal aliens may lower immigrant quality; for low-skilled workers in neighboring low-income countries the economic incentives for illegal migration are very large. Immigrants from the UK have the highest annual earnings, with Canadian, other European, South Asian, East Asian, and other American immigrants having successively lower earnings. The Mexicans and the Vietnamese have the lowest earnings. Over the period 1950 to 1980, US immigration changed from primarily drawing immigrants from countries whose nationals have high relative earnings in the US primarily drawing immigrants from countries whose nationals do less well. Recent immigrants are less favorably selected on the basis of their level of schooling. The analysis of the relative earnings of immigrants during the 1970s using 3 data files shows there has been little change for white immigrants, an ambiguous pattern for Mexican immgrants, perhaps a small decline for Cuban immigrants, and a small rise for Asian immigrants. Overall, without returning to rationing by country of origin, public policy could raise immigrant skill levels by changing the balance between kinship and the individual's skills in the rationing of visas.     

IMMIGRANT EARNINGS: A LONGITUDINAL ANALYSIS

This paper uses the Longitudinal Survey of Immigrants to Australia to analyze the determinants of the level and growth in earnings of adult male immigrants in their first 3.5 years in Australia. The theoretical framework is based on the immigrant adjustment model, which incorporates both the transferability of immigrant skills and selectively in migration. The cross-sectional and longitudinal analyses generate similar findings. The level and relative growth of earnings are higher for immigrants with higher levels of skill and who are economic/skills tested migrants, as distinct from family based and refugee migrants. The analysis indicates that immigrant economic assimilation does occur and that in these data the cross-section provides a good estimate of the longitudinal progress of immigrants. The findings are robust across statistical techniques.     

Why do immigrant workers in Australia perform better than those in Canada? Is it the immigrants or their labour markets?

Research comparing the labour market performance of recent cohorts of immigrants to Australia and Canada points to superior employment and earnings outcomes in Australia. Examining Australian and Canadian Census data between 1986 and 2006, we find that this performance advantage is not driven by differences in broader labour market conditions affecting all new labour market entrants. Rather, the results from comparing immigrants from a common source country – either the U.K., India, or China – suggest that Australian immigrants perform better, particularly in average earnings, primarily because of a different source country distribution. Moreover, the recent tightening of Australian selection policy, most notably its use of mandatory pre‐migration English‐language testing, appears to be having an effect, primarily by further shifting the source country distribution of immigrants away from non‐English‐speaking source countries, rather than in identifying higher‐quality migrants within source countries.     

Adding a Top‐Up Sample to the Household,Income and Labour Dynamics in Australia Survey

Since its commencement in 2001, the Household, Income and Labour Dynamics in Australia Survey has become a much‐used resource by researchers. Over the same time, the Australian population has evolved in a number of ways that the sample, even with ‘following rules’, cannot emulate. Most notable is the lack of recent immigrants arriving after 2001. A general population‐wide top‐up of the sample was added in 2011 which allows new population sub‐groups to be represented and helps alleviate biases from non‐random attrition. This article describes the methodology of the top‐up sample, the response rates achieved and the representativeness of the combined sample.     

Do Selection Criteria Make a Difference?: Visa Category and the Labour Market Status of Immigrants to Australia

This paper assesses the role of selection criteria in the immigrant settlement process. Do skill-based immigrants have higher participation and employment rates than family-based immigrants? Does this represent a head start or a persistent labour market advantage? The Longitudinal Survey of Immigrants to Australia is used to address these questions. Generally, migrants selected for their skills have better labour market outcomes. Over time, the relative gap in participation rates increases, while the gap in employment rates decreases. Net of visa category, outcomes are better for native English speakers and for those who visited Australia prior to migration.     

Neighbourhood effects,preference heterogeneity and immigrant educational attainment

This paper investigates differences between the educational attainment of immigrants, children of immigrants and native-born individuals in Australia by using Australian Youth Survey (AYS) data combined with aggregate Australian Census data. Differences in educational attainment are decomposed into: (i) typical demographic and socio-economic sources common to all ethnic groups; (ii) unobserved region of residence and region of origin effects; and (iii) neighbourhood effects such as degree and ethnic concentration of particular ethnic groups in different neighbourhoods. A theoretical model incorporating these effects is proposed but structural estimation is not possible for lack of appropriate data. Instead, a reduced form methodology is proposed and employed. The empirical results identify positive ethnic neighbourhood effects in high school completion and university enrolment for some immigrant groups in Australia, in particular first and second generation immigrants from Asia. The results indicate that it is not just the size of the ethnic network but the ‘quality’ of the network that is important.     

Demographics and the pension system

"Italian demographic evolution closely resembles that of the other leading European countries, although with some distinctive features, such as a lower birth rate, more rapid population aging and fewer immigrants. Projections for the next two or three decades point to accelerating expansion of the aged population, especially of the very old, and a contraction of the working age population after the turn of the century. However, there are also unknowns involved in the demographic evolution of the aged population, turning on the speed of the decline in senile mortality in the decades to come and the possible effects on the health of the elderly population, hence on the demand for social services, considering among other things changing family patterns. There is broad agreement that the birth rate is now too low, that this could have serious long-run repercussions on relations between generations and on intergenerational transfers, and that there is room for social policy action to influence the reproductive choices of couples. This article examines several possible reproductive models and discusses the foundations for action and the potential policy contradictions."     

Immigration and the Australian Macroeconomy: Perspective and Prospective

Australia has long been a nation of immigrants. The economic purposes of migration and its economic consequences are major public policy issues. This selective review of research looks at the macroeconomic dimensions of this issue for Australia.     

Assimilation to a Welfare State: Labor Market Performance and Use of Social Benefits by Immigrants to Finland*

This paper documents the economic performance of immigrants in a country characterized by an extensive welfare state and a short immigration history. Upon arrival, immigrants to Finland have substantially lower employment rates than comparable natives. While they experience rapid employment growth, only men from OECD countries catch up with natives. Despite the persisting employment and earnings differences between non‐OECD immigrants and natives, the differences in income transfers disappear in roughly 20 years. The immigrant–native employment gaps are larger in Finland than in Australia, Canada, or the US.     

Homeownership and Housing Equity: An Examination of Native- Immigrant Differences in Housing Wealth

This paper examines the differences in homeownership between immigrants and native-born residents using the National Longitudinal Survey of Youth 1979 (NLSY79) data. We estimate the preference for homeownership and the amount of home equity held by households using a two-stage procedure. The results indicate that, although immigrants are less likely to be homeowners, immigrants who make the decision to own homes are more likely to have greater housing equity than native-born residents. About 66 to 70% of the disparity in homeownership can be explained by the difference in characteristics. The remaining disparity results from different homeownership functions estimated for the two groups. We discuss the implications of these findings for policy makers, real estate market researchers, and scholars of consumer behavior.     

The Earnings of Immigrant Men in Australia: Assimilation, Cohort Effects, and Macroeconomic Conditions

This paper analyzes the earnings of immigrant men in Australia using data from Income Distribution Surveys for 1982, 1986 and 1990. The paper expands on the standard approach used in the literature to evaluate immigrant earnings adjustment by considering the impact of current labour market conditions and conditions at labour market entry on current earnings. Immigrants from non-English speaking backgrounds have significantly lower earnings on arrival in Australia compared with native-born males, and this gap is not narrowed as years in Australia increase. However, poorer macroeconomic conditions at entry are found to have a significantly smaller negative effect on the earnings of immigrants from non-English speaking backgrounds than native-born males.