Unemployment Insurance, Immigrants' Skills, and Native Earnings
Jahrgang 60 (2004) / Heft 1, S. 111-139 (29)
29,00 € inkl. gesetzl. MwSt.
This paper investigates the effect of immigration on native earnings in the presence of unemployment and various social insurance policies. If immigration decreases the economy-wide skill ratio and the welfare state is actuarially fair, total native earnings increase under the constant-replacement-ratio policy, while they decrease under both the constant-benefit and the constant-average-income policy. If, however, immigrants improve the economy-wide skill ratio, natives as a whole gain unambiguously, but most under a constant benefit. The ranking between social policies is robust with respect to general taxation, but can reverse when native educational choices are endogenous.