tag:blogger.com,1999:blog-72771041891059664272024-03-05T16:02:05.538+00:00CReAM commentsIn this blog, CReAM Researchers and CReAM Fellows comment on recent events and on the current political debate. Below each article you can add comments.Unknownnoreply@blogger.comBlogger22125tag:blogger.com,1999:blog-7277104189105966427.post-68432698464246244582017-09-14T18:11:00.002+01:002017-09-14T18:11:43.849+01:00Fact Check: does immigration have an impact on wages or employment?<div class="MsoNormal" style="background: white; line-height: normal; margin-bottom: .0001pt; margin-bottom: 0cm;">
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 0.0001pt;">
<b><span style="color: #222222; font-family: "arial" , sans-serif; font-size: 10.0pt;">By Ian Preston</span></b><span style="color: #222222; font-family: "arial" , sans-serif; font-size: 10.0pt;"><o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 0.0001pt;">
<span style="color: #222222; font-family: "arial" , sans-serif; font-size: 10.0pt;">Centre for Research and Analysis of Migration (CReAM) at University
College London<o:p></o:p></span></div>
<div class="MsoNormal" style="background-attachment: initial; background-clip: initial; background-image: initial; background-origin: initial; background-position: initial; background-repeat: initial; background-size: initial; line-height: normal; margin-bottom: 0.0001pt;">
<br /></div>
<div class="MsoNormal" style="margin-left: 36.0pt;">
<i>When I was business secretary
there were up to nine studies that we looked at that took in all the academic
evidence. It showed that immigration had very little impact on wages or
employment. But this was suppressed by the Home Office under Theresa May,
because the results were inconvenient.<o:p></o:p></i><br />
<i><br /></i></div>
<div class="MsoNormal">
<b>Vince Cable, leader of the Liberal Democrats, in a <a href="https://www.theguardian.com/politics/blog/live/2017/sep/06/pmqs-home-office-immigration-leak-reaction-politics-live?page=with:block-59afcd61e4b066447a05c3bf#block-59afcd61e4b066447a05c3bf">statement</a> on
September 6.</b><o:p></o:p><br />
<b><br /></b></div>
<div class="MsoNormal" style="margin-left: 36.0pt;">
<i>There is quite a lot of
evidence that if we have too many low-skilled workers coming in, one of the
effects is to depress the wages of those at the bottom end of the wage scale.<o:p></o:p></i><br />
<i><br /></i></div>
<div class="MsoNormal">
<b>Damian Green, first secretary of state and minister for
the Cabinet Office, <a href="http://www.bbc.co.uk/programmes/b092jw7q">speaking</a> on
BBC Radio 4’s Today programme on September 7.</b><o:p></o:p><br />
<b><br /></b></div>
<div class="MsoNormal">
The effect of immigration on wages and employment has been
the subject of <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=10">numerous
studies</a>, both <a href="http://www.migrationobservatory.ox.ac.uk/resources/briefings/the-labour-market-effects-of-immigration/">in
the UK</a> and <a href="http://www.ucl.ac.uk/~uctpb21/doc/CDP_11_08.pdf">internationally</a>.
Research for the UK points to no convincingly large negative effects of
immigration on <a href="http://cep.lse.ac.uk/pubs/download/pa015.pdf#page=10">average wages</a> of <a href="http://www.cream-migration.org/publ_uploads/CDP_08_06.pdf">British-born
workers</a>. This is largely in line with the <a href="http://www.nber.org/papers/w16736.pdf#page=12">predominant</a> (though
not <a href="https://www.economist.com/blogs/freeexchange/2017/06/immigration-economics">uncontroversial</a>)
finding of studies done in other countries.<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
<a href="http://www.bankofengland.co.uk/research/Documents/workingpapers/2015/swp574.pdf">Some
studies</a> have pointed to the possibility of effects on the <a href="http://www.ucl.ac.uk/~uctpb21/Cpapers/CDP_03_08.pdf">distribution of
wages</a>, holding wage growth back at the lower end and pushing wages up at
the higher end. However, authors of studies which have suggested this have
emphasised that the negative effects are <a href="http://www.independent.co.uk/news/business/news/impact-of-immigration-on-native-wages-infinitesimally-small-a7545196.html">small</a>.
While recent immigrants as a whole have typically been <a href="http://cep.lse.ac.uk/pubs/download/pa015.pdf#page=6">highly qualified</a> relative
to the skill level of the UK labour force, the location of such effects may
have to do with the fact that they tend to work initially in <a href="https://blog.oup.com/2012/07/what-effect-does-immigration-have-on-wages/">lower
paid jobs</a>.<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
Evidence for harmful effects of immigration on employment
is <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/287287/occ109.pdf">also
slim</a>. Most studies have failed to find <a href="http://www.ucl.ac.uk/~uctpb21/Cpapers/ecoj_1038.pdf">clear evidence</a> of <a href="https://www.niesr.ac.uk/sites/default/files/publications/090112_163827.pdf">a
link</a>.<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
One exception, <a href="http://www.telegraph.co.uk/news/2017/08/24/debate-immigration-britain-puts-gdp-ahead-people/">sometimes
cited</a> by advocates of tighter immigration policy, is a 2012 Migration
Advisory Committee <a href="http://cream-migration.org/files/MAC_report_jan2012.pdf">report</a> that
found some association in particular of non-EU migration with employment of
non-immigrants during one period of downturn, though the study itself
emphasises that <a href="http://creamcomments.blogspot.co.uk/2012/01/16th-january-2012-some-thoughts-on.html">the
evidence</a> is <a href="http://cream-migration.org/files/MAC_report_jan2012.pdf#page=124">not
very robust</a>.<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
Overall the Migration Advisory Committee itself <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/333083/MAC-Migrants_in_low-skilled_work__Full_report_2014.pdf#page=289">concluded</a>:
“Evidence to date suggests little effect on employment and unemployment of
UK-born workers, but that wages for the low paid may be lowered as a result of
migration, although again this effect is modest.”<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b>
<b>Impervious political debate<o:p></o:p></b></div>
<div class="MsoNormal">
<br />
Despite the weak evidence, harmful labour market effects
continue to be emphasised in political debate, for example by Theresa May both
when she was <a href="https://theconversation.com/fact-check-is-there-zero-economic-benefit-from-high-immigration-48704">home
secretary</a> and now as <a href="https://www.theguardian.com/politics/2017/sep/08/vince-cable-urges-pm-to-lift-lid-on-eu-immigration-reports">prime
minister</a>. (The same is true <a href="https://www.bloomberg.com/view/articles/2017-09-06/don-t-believe-what-jeff-sessions-said-about-jobs">in
the US</a>).<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
Some may feel it is obvious that the expansion of labour
supply that follows from immigration must harm competing workers. But this
ignores the many ways in which immigration can also lead to expanded labour
demand – through immigrants’ spending on goods produced locally, through the
complementary skills they bring into the country, through encouraging changes
in the pattern of production or encouraging inflow of capital, and so on. For
all of these reasons, it is quite compatible with standard economic theory to
find that immigration might have <a href="https://www.ft.com/content/0deacb52-178b-11e6-9d98-00386a18e39d">little
or no effect</a> on wages or employment.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b>
<b>Verdict<o:p></o:p></b></div>
<div class="MsoNormal">
<br />
Vince Cable’s understanding of the preponderance of academic
evidence on the labour market effects of immigration is accurate. There is
little persuasive evidence that immigration has substantial harmful effects on
average UK wages or employment. Damian Green is correct to identify effects on
the least well paid as being of greatest concern but evidence suggests these
effects are not large.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b>
<b>Review<o:p></o:p></b></div>
<div class="MsoNormal">
<b><br /></b>
<b>Jonathan Wadsworth, professor of economics at Royal
Holloway, University of London</b><o:p></o:p><br />
<b><br /></b></div>
<div class="MsoNormal">
According to standard economic textbooks, the purported
effects of immigration on the existing workforce are undoubtedly negative –
like the minimum wage. How so when the academic evidence – as accurately
outlined in this fact check – does indeed suggest that, contrary to standard texts,
immigration does not have any large significant effect on employment either in
aggregate or among groups supposedly most at risk? Nor does immigration appear
to depress wages of native-born Britons much. The recently resurrected <a href="http://www.bankofengland.co.uk/research/Documents/workingpapers/2015/swp574.pdf">study</a>,
cited by politicians and the media could not determine whether its findings of
a small negative wage effect apply to UK-born people or immigrants or both.<o:p></o:p></div>
<div class="MsoNormal">
<br />
Politicians and the media making disingenuous, selective or,
at best, misinformed interpretations of academic studies do not help. There is
also a lot of dross out there and sifting through it is not always easy, for
anyone, politicians and the media included. Ultimately, continued dialogue and
engagement between academia and the outside world can only help understanding
and inform policy making.<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
<a href="http://www.cream-migration.org/personneldetail.php?id=4" target="_blank">Ian Preston</a> is the Deputy Research Director of CReAM and
Professor in the Department of Economics at UCL<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<br />
<div class="MsoNormal">
Acknowledgement: This piece was first published at <a href="https://theconversation.com/fact-check-does-immigration-have-an-impact-on-wages-or-employment-83666" target="_blank">The Conversation</a><o:p></o:p></div>
</div>
<img alt="The Conversation" height="1" src="https://counter.theconversation.com/content/83666/count.gif?distributor=republish-lightbox-advanced" width="1" />
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-60666426054626423752016-12-09T12:54:00.001+00:002016-12-09T13:39:47.442+00:00Why Britain’s public finances will suffer if Brexit reduces migration<div class="MsoNormal">
<b>By Ian Preston</b><o:p></o:p></div>
<div class="MsoNormal">
Centre for Research
and Analysis of Migration (CReAM) at University College London<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Brexit will have <a href="https://www.ft.com/content/e87f92ea-b176-11e6-a37c-f4a01f1b0fa1"><span style="text-decoration: none; text-underline: none;">high fiscal costs</span></a> and
a large part of that will be a consequence of what happens to migration
numbers. That was the conclusion widely drawn from the <a href="http://budgetresponsibility.org.uk/"><span style="text-decoration: none; text-underline: none;">Office for Budget Responsibility’s</span></a> most
recent <a href="http://budgetresponsibility.org.uk/download/economic-and-fiscal-outlook-november-2016/"><span style="text-decoration: none; text-underline: none;">Economic and Fiscal Outlook</span></a> published
in late November – the first since June’s referendum vote. It was illuminated
further by supplementary <a href="http://budgetresponsibility.org.uk/docs/dlm_uploads/Further-decomposition-of-th-referendum-counterfactual.pdf"><span style="text-decoration: none; text-underline: none;">analysis</span></a> published
on December 8.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
To be precise, Brexit is forecast to lead to a cumulative <a href="https://www.bloomberg.com/news/articles/2016-11-23/brexit-slaps-hammond-with-an-extra-73-billion-in-u-k-borrowing"><span style="text-decoration: none; text-underline: none;">£59 billion more in public
sector borrowing</span></a> over the next five years – £16 billion of
which is attributed to the effect of reduced migration because of the
unfavourable balance between its effects on tax revenue and government
spending. Whereas the negative impact of other Brexit factors peaks in 2018-19,
the effect of migration is forecast to still be rising by 2020-21.
<br />
<iframe allowfullscreen="allowfullscreen" allowtransparency="true" frameborder="0" height="400" id="datawrapper-chart-jbSzY" mozallowfullscreen="mozallowfullscreen" msallowfullscreen="msallowfullscreen" oallowfullscreen="oallowfullscreen" src="https://datawrapper.dwcdn.net/jbSzY/1/" webkitallowfullscreen="webkitallowfullscreen" width="100%"></iframe><br />
<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>What will happen to
migration</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The likely fall in migration is difficult to quantify, given
the <a href="http://www.independent.co.uk/news/uk/politics/brexit-the-head-of-the-treasury-watchdog-says-he-could-be-retired-before-the-economic-impact-is-a7448176.html"><span style="text-decoration: none; text-underline: none;">uncertainty</span></a> about <a href="https://www.ft.com/content/36e5b0e9-baa4-30eb-adc9-dd2babcf2d80"><span style="text-decoration: none; text-underline: none;">Brexit negotiations</span></a>.
As a result, the OBR’s approach to capturing it is necessarily rough and ready.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The <a href="http://www.independent.co.uk/news/uk/politics/liam-fox-immigration-brexit-conservative-party-conference-live-2016-speech-a7345006.html"><span style="text-decoration: none; text-underline: none;">changing political atmosphere</span></a> since
the vote may discourage immigration, as potential migrants expect a <a href="http://www.bbc.co.uk/news/uk-politics-37640982"><span style="text-decoration: none; text-underline: none;">less welcoming reception</span></a>. Eventually, the
terms under which the UK withdraws may permit <a href="http://www.migrationpolicy.org/news/when-dust-settles-migration-policy-after-brexit"><span style="text-decoration: none; text-underline: none;">more restrictive migration
policies</span></a> for arrivals from the EU.<o:p></o:p></div>
<div class="MsoNormal">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br />
What the OBR does is to note that without Brexit it would
have raised its <a href="http://cdn.budgetresponsibility.org.uk/March2016EFO.pdf#page=209"><span style="text-decoration: none; text-underline: none;">estimate of future migration</span></a> by
about 80,000 a year. This is influenced by <a href="https://theconversation.com/latest-migration-figures-make-no-economic-case-for-brexit-60070"><span style="text-decoration: none; text-underline: none;">recent high migration levels</span></a>,
which have been confirmed again in <a href="https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/dec2016"><span style="text-decoration: none; text-underline: none;">the most recent migration
figures</span></a>. Given the referendum outcome, the OBR assumes that this
increase will no longer happen and it treats this as the Brexit effect.</div>
<div class="MsoNormal">
<o:p></o:p><br />
<br />
<table align="center" cellpadding="0" cellspacing="0" class="tr-caption-container" style="margin-left: auto; margin-right: auto; text-align: center;"><tbody>
<tr><td style="text-align: center;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgfoDZAT2aCisQodSnVtdrcgzLui13tu66XZx-8OlpgEXcn4k3Hr2GxH7Oy4tazOqjgpfTpVUb-E8lYlIU39jryFYE2CmC8xxuJzEM2pbtzWO0150Sp0Yi4pzBtdk5ui58Ej82hY8K_-B0/s1600/image-20161208-31405-1qfgpgb.png" imageanchor="1" style="margin-left: auto; margin-right: auto;"><img border="0" height="202" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgfoDZAT2aCisQodSnVtdrcgzLui13tu66XZx-8OlpgEXcn4k3Hr2GxH7Oy4tazOqjgpfTpVUb-E8lYlIU39jryFYE2CmC8xxuJzEM2pbtzWO0150Sp0Yi4pzBtdk5ui58Ej82hY8K_-B0/s400/image-20161208-31405-1qfgpgb.png" width="400" /></a></td></tr>
<tr><td class="tr-caption" style="text-align: center;"><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a>Past and projected net migration to the UK.<span style="background-color: white; color: #727272; font-family: "helvetica neue" , "helvetica" , sans-serif; font-size: 11px;"> </span><span class="attribution" style="background: rgb(255 , 255 , 255); border: 0px; color: #cccccc; font-family: "helvetica neue" , "helvetica" , sans-serif; font-size: 11px; margin: 0px; outline: 0px; padding: 0px; vertical-align: baseline;"><a class="source" href="http://budgetresponsibility.org.uk/docs/dlm_uploads/Further-decomposition-of-th-referendum-counterfactual.pdf" style="color: #cccccc; display: inline; max-width: 100%; outline: none; text-decoration: none; white-space: pre-wrap; word-wrap: break-word;">Office for Budget Responsibility</a></span></td></tr>
</tbody></table>
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br /></div>
<div class="MsoNormal">
This reduction falls some way short of meeting the
government’s stated aspiration of cutting net migration to the <a href="http://www.telegraph.co.uk/news/2016/10/04/theresa-mays-devotion-to-david-camerons-net-migration-target-is/"><span style="text-decoration: none; text-underline: none;">tens of thousands</span></a>,
so it may be that the fiscal consequences of Brexit are being substantially
understated. On the other hand, that target is <a href="https://www.politicshome.com/news/uk/political-parties/conservative-party/boris-johnson/news/81415/boris-johnson-backs-dropping"><span style="text-decoration: none; text-underline: none;">politically contentious</span></a> and
widely viewed as <a href="https://fullfact.org/immigration/eu-immigration-blame-missing-net-migration-target/"><span style="text-decoration: none; text-underline: none;">impossibly ambitious</span></a>.</div>
<div class="MsoNormal">
<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Lowering net migration leads to a lower population and
alters its composition. In particular, since migrants are <a href="http://cep.lse.ac.uk/pubs/download/EA019.pdf"><span style="text-decoration: none; text-underline: none;">typically young, well educated and arriving to work</span></a> it
leads to a population which is older and less likely to participate in the
labour market. <a href="https://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf"><span style="text-decoration: none; text-underline: none;">Effects of this on public
finances</span></a> could come through either side of the public sector
balance sheet, through revenues or through spending.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Impact on tax revenues</b><br />
<br />
The deleterious effect on the revenue side is easiest to
understand. The lower population means less economic activity on which taxes
are paid. Given that migrants tend to be younger than the average UK citizen,
the OBR also predicts that fewer migrants coming in will lead to a decline in
the employment rate, which reduces tax revenue further.</div>
<div class="MsoNormal">
<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Because the inflow continues at the lower level year after
year, the effect on the population builds up, which is why the annual effect on
tax revenues continues to grow.<br />
<br />
In its supplementary set of tables, published on December 8,
the OBR explains that about <a href="http://budgetresponsibility.org.uk/docs/dlm_uploads/Further-decomposition-of-th-referendum-counterfactual.pdf"><span style="text-decoration: none; text-underline: none;">half of the reduction</span></a> comes
through lower income tax and national insurance contributions and about a
quarter through lower consumption tax receipts such as VAT. By 2020-21, the
cumulative <a href="http://budgetresponsibility.org.uk/docs/dlm_uploads/Further-decomposition-of-th-referendum-counterfactual.pdf#page=7"><span style="text-decoration: none; text-underline: none;">fall in tax receipts</span></a> is
forecast to have reached £17.3 billion. This is much the most important factor
driving the increase of £16 billion in forecast borrowing by that year that the
OBR attributes to lower migration as a result of Brexit.</div>
<div class="MsoNormal">
<br />
<iframe allowfullscreen="allowfullscreen" allowtransparency="true" frameborder="0" height="275" id="datawrapper-chart-8hI35" mozallowfullscreen="mozallowfullscreen" msallowfullscreen="msallowfullscreen" oallowfullscreen="oallowfullscreen" src="https://datawrapper.dwcdn.net/8hI35/2/" webkitallowfullscreen="webkitallowfullscreen" width="100%"></iframe><br />
<o:p></o:p></div>
<div class="MsoNormal">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br /></div>
<div class="MsoNormal">
<b>Not much change to
spending</b><o:p></o:p></div>
<div class="MsoNormal">
<br />
On the expenditure side, things are more complicated.
Welfare spending is treated as sensitive to migration because benefit claims
are affected by the size and composition of the population, albeit that average
welfare spending on migrants is lower than in the population as a whole. By
2020-21, cumulative welfare spending is forecast <a href="http://budgetresponsibility.org.uk/docs/dlm_uploads/Further-decomposition-of-th-referendum-counterfactual.pdf#page=9"><span style="text-decoration: none; text-underline: none;">to be lower</span></a> by
£2.1 billion as a result of the lower migration. Offsetting this is an increase
of £0.6 billion in debt interest spending as a consequence of the lower tax
receipts.</div>
<div class="MsoNormal">
<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
But the largest part of spending – on public services such
as education, health, police, defence and so on – is treated as fixed by prior
plans. The OBR assumes that reduced migration will not lead to cutbacks in
spending on these items over the horizon it considers.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Of course, migrants are entitled to use public services even
if, contrary to popular perception, there is <a href="http://voxeu.org/article/immigration-and-public-finances"><span style="text-decoration: none; text-underline: none;">little evidence</span></a> that
they make excessive demands. So the OBR’s projected reduction in numbers of
migrants without any change in planned spending means that pressure on those
public services is implicitly being allowed to diminish somewhat. Falling
population numbers are not being matched by commensurate spending cutbacks on
these services and the projected increase in borrowing cannot therefore be
straightforwardly interpreted as the cost of the migration changes. What the
OBR is doing is making a forecast for borrowing, not evaluating the cost of
lower migration after Brexit.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>What the cost will
be</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
It is perhaps helpful to compare the OBR figures to the <span style="text-decoration: none; text-underline: none;"><a href="http://www.cream-migration.org/files/FiscalEJ.pdf">best comprehensive costing</a> </span>available
for the <a href="http://voxeu.org/article/fiscal-effects-immigration-uk"><span style="text-decoration: none; text-underline: none;">public finance impact</span></a> of
recent migration provided by economists <a href="http://www.cream-migration.org/personneldetail.php?id=2"><span style="text-decoration: none; text-underline: none;">Christian Dustmann</span></a> and <a href="https://sites.google.com/site/tommasofrattini/home"><span style="text-decoration: none; text-underline: none;">Tommaso Frattini</span></a>.<o:p></o:p></div>
<div class="MsoNormal">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br /></div>
<div class="MsoNormal">
Their calculations suggest that recent migration to the UK
from the European Economic Area (EEA) over the period 2001-2011 benefited the
exchequer by about £22 billion – with taxes paid exceeding spending costs
imposed by about 34%. Over the ten-year period which they consider, EEA
immigration expanded the economy by about 7m immigrant-years – calculated as
about 1.4m immigrants each being in the country for an average of about five
years. The net benefit to the exchequer was therefore of the order of £3,000
per additional immigrant, per year (in 2011 prices).<o:p></o:p></div>
<div class="MsoNormal">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br /></div>
<div class="MsoNormal">
To compare, the OBR forecasts an increase in borrowing of
£16bn over 2016-2021 for about 1.2m fewer immigrant-years. This suggests a
forecast impact on borrowing of about £13,000 per missing immigrant per year.
This is a significantly higher figure – but that is because it is an answer to
a different question and evaluated over a different period coming after a
decade of output growth and rising prices. Between 2011 and 2021, the OBR
forecasts nominal GDP to rise by about 40%.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>What is missing</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The OBR projections <a href="http://www.niesr.ac.uk/blog/brexit-migration-and-uk-economy#.WD9e2fmLQ2x"><span style="text-decoration: none; text-underline: none;">ignore</span></a> many
possible economic effects of migration. If immigration <a href="https://www.theguardian.com/uk-news/2016/dec/07/major-cut-eu-migrants-risks-long-term-damage-uk-economy-niesr-report?CMP=share_btn_tw"><span style="text-decoration: none; text-underline: none;">affects</span></a> UK
workers’ <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=10"><span style="text-decoration: none; text-underline: none;">wages</span></a> or
returns to capital, if it affects <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=7"><span style="text-decoration: none; text-underline: none;">innovation and productivity</span></a>,
or affects the cost of <a href="http://www.ucl.ac.uk/~uctpb21/reports/provision-of-uk-public-services.pdf"><span style="text-decoration: none; text-underline: none;">providing public services</span></a> then
this is not accounted for. Although the OBR does allow for reduced migration to <a href="http://cdn.budgetresponsibility.org.uk/March2016EFO.pdf#page=210"><span style="text-decoration: none; text-underline: none;">reduce housing demand and cut
house prices</span></a>, no effects on receipts from stamp duty, for example,
are incorporated in the calculations of effects of migration.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Its projections also allow for no changes in the composition
of migrants. If low-skilled migrants are more discouraged by Brexit than
high-skilled migrants, say, then the fiscal consequences <a href="http://www.telegraph.co.uk/news/2016/12/01/registration-eu-residents-uk-will-formidable-task/"><span style="text-decoration: none; text-underline: none;">might be less pessimistic</span></a> since
the discouraged migrants would have paid less in taxes. However, the reductions
needed to bring the government near to its <a href="http://www.migrationobservatory.ox.ac.uk/resources/commentaries/uk-immigration-policy-look-like-brexit/"><span style="text-decoration: none; text-underline: none;">target of net migration in the
tens of thousands</span></a> would need to cover more than the
low-skilled.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
International migrants are on the whole the sort of
productive, economically motivated individuals that governments ought to be
keen to attract. Making the country a less welcoming place and adding
bureaucracy to economic relations with its nearest neighbours is <a href="http://uk.businessinsider.com/uk-immigration-policy-post-brexit-academic-analysis-by-jonathan-portes-2016-10"><span style="text-decoration: none; text-underline: none;">not a promising route</span></a> to
attracting the most fiscally lucrative migrants.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://www.cream-migration.org/personneldetail.php?id=4" target="_blank">Ian Preston</a> is the Deputy Research Director of CReAM and Professor in the Department of Economics at UCL</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Acknowledgement: This piece was first published at <a href="https://theconversation.com/why-britains-public-finances-will-suffer-if-brexit-reduces-migration-69598" target="_blank">The Conversation</a></div>
<div class="MsoNormal" style="background: white;">
<span style="color: #222222; font-family: "arial" , sans-serif; font-size: 10.0pt; line-height: 107%;"><a href="http://www.cream-migration.org/personneldetail.php?id=4" target="_blank"><span style="color: #ec6a11; text-decoration: none;"><br /></span></a></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<u1:p></u1:p>
</div>
<div class="MsoNormal">
<br /></div>
<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/69598/count.gif?distributor=republish-lightbox-basic" width="1" />Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-21994478366491363032016-06-01T09:45:00.002+01:002016-06-01T11:36:24.573+01:00Comment on Migrationwatch's Analysis of the Fiscal effects of Immigration to the UK in 2014/15<div style="background: white;">
<div class="MsoNormal">
<b>By Christian Dustmann and Tommaso Frattini</b><o:p></o:p></div>
<div class="MsoNormal">
Centre for Research and Analysis of Migration (CReAM)<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://www.migrationwatchuk.org/briefing-paper/381" target="_blank">MW</a> has extended our analysis of the fiscal impact of
immigration to the UK (<a href="http://www.cream-migration.org/files/FiscalEJ.pdf" target="_blank">Dustmann and Frattini 2014</a>) to fiscal year 2014, a year
for which the data were not available when we wrote our paper. However,
while they claim to replicate our analysis in most points, they only consider
that specific year, rather than computing the cumulative fiscal contributions
of all immigrants who arrived since 2000, as we did.</div>
<div class="MsoNormal">
<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
It should be noted that the idea of our paper was to compute
the contribution of EEA immigrants (A10 and “old Europe”) for those who entered
the country after 2000, and up until the end of the data window (which was 2011
for our paper). We believe that this calculation answers the key policy question,
which is “What is the net fiscal contribution of immigrants who arrived in the
UK since year 2000 up until today”, or “What is the net fiscal contribution of
immigrants who arrived in the UK since year 2000 up until today, relative to
natives”. In that way, we capture entire entry cohorts of immigrants up until
the present day. <o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
What MW did was just choosing one year only – 2014. This
tells us the rate at which the cumulated contribution of immigrants is growing
in 2014 only. This is certainly a less interesting question than the
question we pose. For that particular year, they show that EEA immigrants who arrived
since 2000 make a roughly neutral net contribution. It
would remain true that the cumulative contribution over the last 15 years
must be positive. It should also be noted that the net fiscal
contribution of EEA immigrants even for that one year is still higher than that
of natives. In fact, MW estimates that in 2014 natives contribute to the
Exchequer about 85% of what they cost, thus making a substantial <i>negative</i> fiscal contribution.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A couple of additional points are worth noting.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal" style="margin-left: 36.0pt; mso-list: l0 level1 lfo1; text-indent: -18.0pt;">
<!--[if !supportLists]-->1)<span style="font-size: 7pt; font-stretch: normal;">
</span><!--[endif]-->The central scenario analysed by MW is one where
recent immigrants are assumed to make no contribution to corporate taxes.
However, as we discuss in our study, the allocation of corporate taxes and
business rates raises complicated questions of incidence. The fact that businesses write the cheques
does not mean that the burden do not fall ultimately on consumers or workers. In
fact, there is a literature in economics that suggests that it is workers and
consumers who ultimately pay the major share of such taxes, if not all. Our
analysis was taking no stance on this debate, apportioning capital and corporate tax payments, net of
the percentage likely to be paid by foreign shareholders, on a per capita basis
among the adult population. When MW adopts this assumption, which we believe is
more realistic and grounded in economic evidence, they find that recent EEA
immigrants have made an overall fiscal contribution of £1.5 million in 2014.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal" style="margin-left: 36.0pt; mso-list: l0 level1 lfo1; text-indent: -18.0pt;">
<!--[if !supportLists]-->2)<span style="font-size: 7pt; font-stretch: normal;">
</span><!--[endif]-->MW emphasise in their study mostly their results
for the entire resident immigrant population in the UK in 2014. As we have made
repeatedly clear, in our paper and in other comments, this is a figure that is
extremely difficult to interpret, and it is not clear what question it answers.
It reports the contribution at one point in time of a very heterogeneous
population of immigrants, many of whom have entered several years or even
decades ago, and any contributions they may have made earlier is ignored. Moreover,
a substantial fraction of immigrants who arrived at some time in the past have
returned to their home countries by 2014, after possibly spending their most
productive years in the UK and contributing to the fiscal coffers. We believe
that this figure is therefore not very informative.<o:p></o:p></div>
<br />
<div class="MsoNormal">
<br /></div>
</div>
Unknownnoreply@blogger.comtag:blogger.com,1999:blog-7277104189105966427.post-72546862143136168152016-05-27T17:40:00.000+01:002016-05-27T19:05:20.959+01:00Latest migration figures make no economic case for Brexit<div class="MsoNormal">
<b>By Ian Preston</b><o:p></o:p></div>
<div class="MsoNormal">
Centre for Research and Analysis of Migration (CReAM) at
University College London</div>
<div class="MsoNormal">
<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There is an increasing focus on migration in the build up to
the EU referendum. It is arguably the key issue which Leave advocates feel
confident <a href="https://next.ft.com/content/217da52e-232d-11e6-9d4d-c11776a5124d"><span style="text-decoration: none; text-underline: none;">of having majority support on</span></a>.
And headlines that proclaim migration to be nearing a <a href="http://www.reuters.com/article/us-britain-eu-immigration-idUSKCN0YH0SS"><span style="text-decoration: none; text-underline: none;">“record high”</span></a> fuel
the Brexit campaign’s calls to quit the EU and end the commitment to free
movement of labour.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
As the last release of migration statistics before the
referendum, the <a href="http://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/may2016"><span style="text-decoration: none; text-underline: none;">latest quarterly figures</span></a>from
the UK’s Office for National Statistics assume heightened significance. While
they largely confirm what we already know, it is worth looking at some of the
detail.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Estimated <a href="http://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/may2016#net-migration-to-the-uk"><span style="text-decoration: none; text-underline: none;">net migration</span></a> remains
historically high. The latest figures show a slight rise, although not by a
statistically significant amount. The figures released are not a comprehensive
count of everyone who has come and gone, but an estimate <a href="http://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/february2016#accuracy-of-migration-estimates"><span style="text-decoration: none; text-underline: none;">based principally on a sample
survey</span></a> conducted at points of entry and exit.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
They are therefore subject to sampling variation and the
magnitude of the recorded change is within the range statistically compatible
with no actual change from the previous quarter. There is nothing new therefore
to get excited about in the headline figure.<o:p></o:p></div>
<div class="MsoNormal">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br /></div>
<div class="MsoNormal">
The long-term annual net migration figure of 333,000 is the
difference between a gross inflow of 630,000 people and an outflow of 297,000
people. So people are arriving at roughly twice the rate at which they are
leaving. What change the figures do record is a consequence of a <a href="http://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/february2016#emigration-from-the-uk"><span style="text-decoration: none; text-underline: none;">fall in emigration</span></a> (though
still statistically insignificant) rather than of a rise in immigration.<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiANfkXmCfBloV9HSUmXkkkT4r61tXXm4LiofzyL5cB-u5hGgdPkExbcfzCgjgL89JtY5-ACpVKse8n_71sQZALOSjMnYviywi4itjVvCe5vBa3YdPNqjwfx9t2Z5vMHJhXYh31POzvPwI/s1600/image-20160526-22068-v0hg87.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="390" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiANfkXmCfBloV9HSUmXkkkT4r61tXXm4LiofzyL5cB-u5hGgdPkExbcfzCgjgL89JtY5-ACpVKse8n_71sQZALOSjMnYviywi4itjVvCe5vBa3YdPNqjwfx9t2Z5vMHJhXYh31POzvPwI/s400/image-20160526-22068-v0hg87.jpg" width="400" /></a></div>
<br /></div>
<div class="MsoNormal">
<div class="separator" style="clear: both; text-align: center;">
</div>
<span style="color: windowtext; mso-fareast-language: EN-GB; mso-no-proof: yes; text-decoration: none; text-underline: none;"><!--[if gte vml 1]><v:shapetype id="_x0000_t75"
coordsize="21600,21600" o:spt="75" o:preferrelative="t" path="m@4@5l@4@11@9@11@9@5xe"
filled="f" stroked="f">
<v:stroke joinstyle="miter"/>
<v:formulas>
<v:f eqn="if lineDrawn pixelLineWidth 0"/>
<v:f eqn="sum @0 1 0"/>
<v:f eqn="sum 0 0 @1"/>
<v:f eqn="prod @2 1 2"/>
<v:f eqn="prod @3 21600 pixelWidth"/>
<v:f eqn="prod @3 21600 pixelHeight"/>
<v:f eqn="sum @0 0 1"/>
<v:f eqn="prod @6 1 2"/>
<v:f eqn="prod @7 21600 pixelWidth"/>
<v:f eqn="sum @8 21600 0"/>
<v:f eqn="prod @7 21600 pixelHeight"/>
<v:f eqn="sum @10 21600 0"/>
</v:formulas>
<v:path o:extrusionok="f" gradientshapeok="t" o:connecttype="rect"/>
<o:lock v:ext="edit" aspectratio="t"/>
</v:shapetype><v:shape id="Picture_x0020_3" o:spid="_x0000_i1027" type="#_x0000_t75"
alt="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/124202/width754/image-20160526-22068-v0hg87.jpg"
href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/124202/area14mp/image-20160526-22068-v0hg87.jpg"
style='width:565.5pt;height:554.25pt;visibility:visible;mso-wrap-style:square'
o:button="t">
<v:imagedata src="file:///C:\Users\uctplam\AppData\Local\Temp\msohtmlclip1\01\clip_image001.jpg"
o:title="image-20160526-22068-v0hg87"/>
</v:shape><![endif]--><!--[if !vml]--><!--[endif]--></span>Long-term international
migration, UK, 1970 to 2014. <a href="http://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/may2016"><span style="text-decoration: none; text-underline: none;">Office for National Statistics</span></a><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
This illustrates a point that rises in net migration can be
as easily a result of fewer individuals leaving as of more coming. Is
insufficient emigration what worries those upset by migration numbers? It seems
unlikely.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>A closer look at the
numbers</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The Brexit debate is focused more on migration from within
the EU than immigration from outside and the ONS figures are also <a href="http://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/february2016#immigration-to-the-uk"><span style="text-decoration: none; text-underline: none;">illuminating on this</span></a>.
Net inflows of EU citizens (other than the UK) and non-EU citizens are very
similar: 184,000 and 188,000 respectively. So are the gross inflows, 270,000
and 277,000. Whether measured net or gross, EU immigration therefore accounts
for about half of the total.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The statistics show that work is the most common reason for
immigration, accounting for 308,000 arrivals, 58% of whom had a definite job to
go to and the rest arriving with the intention of looking for work. Many more
of these were EU citizens (61%) than were from outside the EU (24%). The number
is currently rising.<o:p></o:p></div>
<div class="MsoNormal">
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEht8_nGbtltyS7cdfj7uObdDi_haj0IIcEAyoub7avSyLBYfAYa1gCW2oMWtJxicjF-2o0lBSf2xsnxW8Pai1YrCm2eOdOPLhqPx1358COquoxOOm3C7lE7cXocp8CjqFsqsWR1erUjGWI/s1600/image-20160526-22050-10n5mmz.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="300" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEht8_nGbtltyS7cdfj7uObdDi_haj0IIcEAyoub7avSyLBYfAYa1gCW2oMWtJxicjF-2o0lBSf2xsnxW8Pai1YrCm2eOdOPLhqPx1358COquoxOOm3C7lE7cXocp8CjqFsqsWR1erUjGWI/s400/image-20160526-22050-10n5mmz.jpg" width="400" /></a></div>
<br />
<br />
<a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/124201/area14mp/image-20160526-22050-10n5mmz.jpg"><span style="color: windowtext; mso-fareast-language: EN-GB; mso-no-proof: yes; text-decoration: none; text-underline: none;"><!--[if gte vml 1]><v:shape id="Picture_x0020_2"
o:spid="_x0000_i1026" type="#_x0000_t75" alt="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/124201/width754/image-20160526-22050-10n5mmz.jpg"
href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/124201/area14mp/image-20160526-22050-10n5mmz.jpg"
style='width:565.5pt;height:424.5pt;visibility:visible;mso-wrap-style:square'
o:button="t">
<v:imagedata src="file:///C:\Users\uctplam\AppData\Local\Temp\msohtmlclip1\01\clip_image002.jpg"
o:title="image-20160526-22050-10n5mmz"/>
</v:shape><![endif]--><!--[if !vml]--><!--[endif]--></span></a>Net long-term
international migration by citizenship, UK, 1975 to 2015. <a href="http://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/may2016"><span style="text-decoration: none; text-underline: none;">Office for National Statistics</span></a><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
By contrast, the numbers arriving for study fell from
191,000 to 167,000 and these were mainly from outside the EU (72%) rather than
from inside (23%). The number of those coming to accompany or join others, for
example for marriage or family reunion, were smaller than either labour or
student migration at 73,000.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The number of asylum applications, despite its prominence in
much discussion, was lower than any of these, although rising – about 42,000 in
the year to March 2016, with about 12,000 applications granted over the same
period.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>An ill-judged aim</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The headline figure of more than 300,000 net migration is a
continuing embarrassment to the government because of its aspiration to <a href="http://www.bbc.co.uk/news/uk-politics-32816454"><span style="text-decoration: none; text-underline: none;">keep this below 100,000</span></a>. Obviously, they
are nowhere near to achieving that, but to many there is something seriously
ill-judged in the aim itself.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A net immigration target is a target for the difference
between two large numbers – immigration and emigration – only one of which the
government has any ability to control. Furthermore, its influence even over
immigration is diminished by the EU commitment to free movement of labour,
particularly when half of the gross inflow is EU citizens, largely coming to
the UK to work.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Efforts to reduce immigration are therefore drawn towards
the relatively controllable categories such as <a href="https://www.gov.uk/government/news/major-changes-to-student-visa-system"><span style="text-decoration: none; text-underline: none;">student migration</span></a>, <a href="https://www.gov.uk/government/collections/family-and-private-life-rule-changes-9-july-2012"><span style="text-decoration: none; text-underline: none;">family migration</span></a> or <a href="https://next.ft.com/content/3648ca34-fa1f-11e4-a41c-00144feab7de"><span style="text-decoration: none; text-underline: none;">high-skilled immigration</span></a> from
outside the EU – even though these are not the sorts of immigration that are <a href="http://www.britishfuture.org/articles/news/skills-trump-culture-in-migration-attitudes-bsa-shows/"><span style="text-decoration: none; text-underline: none;">most unpopular</span></a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Bad economics</b><o:p></o:p></div>
<div class="MsoNormal">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br /></div>
<div class="MsoNormal">
A case is therefore made for Brexit because it could
liberate the UK from having to honour the free movement of European labour. At
least two arguments suggest this might be a bad idea.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
First, the <a href="https://www.opendemocracy.net/brexitdivisions/ian-preston/confident-uk-has-nothing-to-fear-from-free-movement-of-labour"><span style="text-decoration: none; text-underline: none;">economic advantages</span></a> of
participating in <a href="http://www.niesr.ac.uk/blog/labour-mobility-european-union-brief-history#.V0b0wfkrKUl"><span style="text-decoration: none; text-underline: none;">free movement of labour</span></a> would
be lost. There are good reasons to think that free movement is <a href="http://cep.lse.ac.uk/pubs/download/brexit05.pdf"><span style="text-decoration: none; text-underline: none;">good for productivity</span></a>, allowing firms to
recruit widely for skills. It’s also <a href="http://voxeu.org/article/immigration-and-public-finances"><span style="text-decoration: none; text-underline: none;">good for public finances</span></a>,
bringing in young migrants keen to work whose contributions in taxes outweigh
any costs imposed on the public exchequer. And it’s <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=7"><span style="text-decoration: none; text-underline: none;">good for economic dynamism</span></a>,
allowing fresh ideas to spread and be adopted.<br />
<br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhXh9u_kEfseWwtERqEqNBoOA7Jrs-0KTI9RFCIsa2oN8gj69VnxkmN7n-SW-zP-8OJx12HQNVPPafgaOZ-UdeAZIA23d_OaHN991az-_bcTiYerHLHiA8IApP321VztUVb011f48ppCxk/s1600/image-20160526-22073-6oz8lz.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="298" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhXh9u_kEfseWwtERqEqNBoOA7Jrs-0KTI9RFCIsa2oN8gj69VnxkmN7n-SW-zP-8OJx12HQNVPPafgaOZ-UdeAZIA23d_OaHN991az-_bcTiYerHLHiA8IApP321VztUVb011f48ppCxk/s320/image-20160526-22073-6oz8lz.jpg" width="320" /></a></div>
<br /></div>
<div class="MsoNormal">
<br />
<br />
<a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/124203/area14mp/image-20160526-22073-6oz8lz.jpg"><span style="color: windowtext; mso-fareast-language: EN-GB; mso-no-proof: yes; text-decoration: none; text-underline: none;"><!--[if gte vml 1]><v:shape id="Picture_x0020_1"
o:spid="_x0000_i1025" type="#_x0000_t75" alt="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/124203/width754/image-20160526-22073-6oz8lz.jpg"
href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/124203/area14mp/image-20160526-22073-6oz8lz.jpg"
style='width:565.5pt;height:528pt;visibility:visible;mso-wrap-style:square'
o:button="t">
<v:imagedata src="file:///C:\Users\uctplam\AppData\Local\Temp\msohtmlclip1\01\clip_image003.jpg"
o:title="image-20160526-22073-6oz8lz"/>
</v:shape><![endif]--><!--[if !vml]--><!--[endif]--></span></a>Long-Term International
Migration estimates of immigration to the UK, by main reason for migration,
2006 to 2015. <a href="http://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/internationalmigration/bulletins/migrationstatisticsquarterlyreport/may2016"><span style="text-decoration: none; text-underline: none;">Office for National Statistics</span></a><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Evidently there are costs in adjusting to high flows of
people, but concerns that immigration is damaging either to <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=10"><span style="text-decoration: none; text-underline: none;">labour market prospects of
British-born workers</span></a> or to <a href="http://voxeu.org/article/fiscal-effects-immigration-uk"><span style="text-decoration: none; text-underline: none;">public finances</span></a>are
not <a href="https://theconversation.com/fact-check-is-there-zero-economic-benefit-from-high-immigration-48704"><span style="text-decoration: none; text-underline: none;">borne out by evidence</span></a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
But second, the <a href="http://ner.sagepub.com/content/236/1/14.full.pdf+html"><span style="text-decoration: none; text-underline: none;">only plausible way to restrict
freedom of movement after Brexit</span></a> would be to choose <a href="http://cep.lse.ac.uk/pubs/download/brexit02.pdf"><span style="text-decoration: none; text-underline: none;">the most economically damaging</span></a> of the
options for post-Brexit trading agreements and access to the single market.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The weight of evidence has been <a href="https://longandvariable.wordpress.com/2016/05/23/280-economists-now-against-brexit-as-ucl-and-lse-sign/"><span style="text-decoration: none; text-underline: none;">gaining increasing acceptance</span></a> among <a href="http://www.telegraph.co.uk/business/2016/05/22/these-economists-are-a-fractious-group-but-they-all-want-to-stay/"><span style="text-decoration: none; text-underline: none;">economists</span></a> that
the economic losses from Brexit would depend critically on trade arrangements
negotiated in the aftermath.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
While <a href="https://theconversation.com/which-brexit-forecast-should-you-trust-the-most-an-economist-explains-59992"><span style="text-decoration: none; text-underline: none;">the most plausible estimates</span></a> suggest
that the range of options go from bad to very bad, the worst options in terms
of <a href="http://ner.sagepub.com/content/236/1/2.full.pdf"><span style="text-decoration: none; text-underline: none;">long-term permanent losses in
national income</span></a> and <a href="http://www.ifs.org.uk/publications/8296"><span style="text-decoration: none; text-underline: none;">harm to public finances</span></a> are the only
ones compatible with long-term restrictions on free movement. Alarmingly high
costs would therefore be incurred for no compelling economic advantage.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The economic case is therefore clear – immigration has not
been bad for the UK. But even voters who think it has should be wary of
believing that Brexit would allow Britain to withdraw from freedom of movement
without other high economic costs.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://www.cream-migration.org/personneldetail.php?id=4" target="_blank">Ian
Preston</a> is the Deputy Director of CReAM and Professor in the
Department of Economics at UCL.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
</div>
<div class="MsoNormal">
<b>Acknowledgement: </b>This piece was published first
at <a href="https://theconversation.com/latest-migration-figures-make-no-economic-case-for-brexit-60070">The
Conversation</a><o:p></o:p><br />
<br /></div>
<br />
<div class="MsoNormal">
<br /></div>
<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/60070/count.gif" width="1" />Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-13061893900829091522016-03-20T18:11:00.000+00:002016-05-27T18:19:38.769+01:00A confident UK has nothing to fear from free movement of labour<div class="MsoNormal">
<b>By Ian Preston</b><o:p></o:p></div>
<div class="MsoNormal">
Centre for Research and Analysis of Migration (CReAM) at
University College London<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><b>Migration brings net
gains to the UK, and to hamper it would likely be as bad for British nationals
as it would be for EU migrants.</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Freedom of movement is at the core of arguments over Brexit.
Not everyone in favour of Brexit is against free movement but polling evidence
suggests that concern about immigration is strongly linked to support for EU
withdrawal. Among the most common reasons given for voting Leave is the
suggestion that it will restore British control over labour migration from
European sources. By removing the country from the obligation to honour free
movement of workers, it is suggested, it will make it possible to selectively
and advantageously discourage immigration of less attractive sorts of workers.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Many have argued plausibly that the supposition on which
this is based is questionable, that it will be impossible to negotiate
continued access to European markets for British goods and services without
also accepting continued free movement of labour into British markets. Indeed
the delinking of different dimensions of free movement would not be
straightforward, even if it were desirable. Free flow of services and free flow
of individuals delivering those services are not easily separable, for example:
you can’t engage a bricklayer’s services unless they are allowed to come and
lay the bricks. If all of this is true, then British withdrawal would simply
dilute British influence over the rules of free movement.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
These sorts of points, convincing as they might be, are not
what I want to concentrate on here. Instead I want to question the idea that
separating Britain from the free movement of labour within Europe would be
economically beneficial even if it were feasible.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
From an economic point of view, mobility of labour is
advantageous in many respects. Allowing workers to move where they are best
rewarded is helpful to productive efficiency. It means that, when skill
shortages arise, firms can recruit widely and workers can supply labour where
their particular abilities are most in demand. British firms benefit, just as
do firms in other countries, from being able to recruit from a broader pool for
the particular skills needed in their operations. At the same time British
workers gain, just as do workers in other countries, from access to a broader
pool of possible employers.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Free movement also provides insurance against local labour
market fluctuations. When there is a downturn in one region and a boom
elsewhere, flows of workers between them can dampen the effects. Judging this
by the economic circumstances of a single point in time gives a poor guide to
the long run benefits this brings. British workers stand to gain from this when
British labour markets are weak just as do workers in other countries when conditions
suit movement for them.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The main benefits of free labour movement accrue, of course,
to migrants themselves (including British-born migrants) who can enhance their
incomes substantially by moving to where they are most valued. Some of
those gains are captured in the receiving country through taxes paid on and out
of migrants’ incomes. But the non-moving population may also see their own
incomes change as a consequence of the movement of foreign labour and any
movement of capital associated with it. If the possibility of employing
immigrants keeps firms in the UK, for instance, then that may generate or
prevent the loss of employment for British-born workers. Wages of non-movers
may also be affected and some may gain and some may lose. Those whose skills
are complemented by those who arrive and those who were competing with them in
the areas they leave are most likely to gain, while those who compete most
closely with them where they arrive and whose skills were most strongly
complemented where they left are most likely to lose. Economies have many
long-term and short-term ways to adjust which will damp these effects down,
perhaps even to zero. And these effects do not just take from one person to
give to another – the overall average wage effect on workers other than the
migrants themselves may be positive. But if the harmful impact were to be
concentrated on the less affluent then that would be a legitimate reason to
worry.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Net gains</b><o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><iframe allowfullscreen='allowfullscreen' webkitallowfullscreen='webkitallowfullscreen' mozallowfullscreen='mozallowfullscreen' width='320' height='266' src='https://www.blogger.com/video.g?token=AD6v5dyelDKdNrkPu5TWELY6VQQuB-EOd9uMXVTFPEYRWk6YtUQfHhYiXzOZoyHaOAa0rcuRvzjeHpm7HwGumcF9XA' class='b-hbp-video b-uploaded' frameborder='0'></iframe></div>
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br /></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<i><a href="https://vimeo.com/160711225">Ian Preston on
Migration in the Brexit Debate</a> from <a href="https://vimeo.com/uclei">UCL European Institute</a> on <a href="https://vimeo.com/">Vimeo</a>.<o:p></o:p></i></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
So what does the evidence say? In the UK it suggests that
migrants tend to work initially for pay well below that which might be expected
given their qualifications if they had been locally born, presumably because it
takes time to learn local skills such as command of the language and to embed
themselves into local labour markets. To the extent that it is possible to
identify negative effects on wages of locals – by comparing outcomes in parts
of the country with different migrant inflows – these appear to be strongest
exactly in the part of the wage distribution where migrants seem to be working,
which is to say at lower wages. Nonetheless the effects are small, suggesting
that the ability of the economy to absorb immigration without compromising the
wages of the hardest hit is reassuringly strong. Moreover, any losses appear if
anything to be more than balanced by gains to others, and those gains could be
spread around if the political will were there to do so.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Why might the average individual in the receiving country
gain? Maybe migration spreads ideas and encourages innovation. Letting
innovators move to where their ideas can be developed may be important to
economic dynamism and as entrepreneurs move they expose those with whom they
work to new ideas. There is not much evidence on this for the UK but there is
tentative evidence elsewhere that migration is associated with innovation and
entrepreneurship.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Furthermore, freedom of movement allows certain industries
to maximise their productivity by allowing for the build-up of a workforce in
certain localities. Again this is something generally beneficial. One context
in which this may be true, for example, is scientific research. Knowledge
spillovers from concentrating the best minds in disciplinary specialities in
the same place may be substantial, something reflected in the international
composition of university departments and research laboratories.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Furthermore since benefits from research are largely public,
enduring, and enjoyed in common, it makes sense for public funding to play a
large role and much of that funding is at the European level. The wisdom of
cutting the UK off from participation in such arrangements under the hope that
the desirable outcomes could somehow be replicated through negotiation and
newly formulated visa rules is questionable.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>The question of
benefits</b><o:p></o:p></div>
<div class="MsoNormal">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br /></div>
<div class="MsoNormal">
Perhaps the strongest case for worrying about the possible
implications of free movement regards its interaction with the public sector.
There are well-established arguments within economics that suggest the
redistributive functions of government should happen at the highest possible
geographic tiers, not only because that allows addressing a wider range of
inequalities but also because it means that migration between lower tier
jurisdictions cannot unravel the effects. If one jurisdiction provides more
redistributive services, especially if entitlement to use them has no past
contributory basis, then the possibility that that will attract the neediest
migrants from other jurisdictions could compromise sustainability. Since
European social provision is principally a national responsibility, concern
that free movement could compromise social programmes has to carry some weight
in principle.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
But evidence to support the seriousness of these concerns is
again lacking. From what we know, migration is motivated principally by work
and movers to the UK contribute positively to the exchequer at a time when
there is an overall fiscal deficit. Migrants are no more unhealthy and no more
criminally inclined than the British-born, and they tend to arrive already
educated. Of course if they stay then they will age and eventually draw more
heavily on public services, but this is just to say they will eventually come
to be more like those already in the country.<o:p></o:p></div>
<div class="MsoNormal">
<br />
Notwithstanding the evidence, the British government has
negotiated an agreement allowing for circumstances in which an extended waiting
period could be imposed on EU migrants before they could claim certain
benefits. The agreement reached has been widely derided by advocates on the
Leave side, who point out that even those wanting to remain accept that it is
unlikely to affect migration levels. But this ignores the fact that those who
believe this do so precisely because they never believed that welfare tourism
was a problem in the first place.</div>
<div class="MsoNormal">
<o:p></o:p></div>
<div class="MsoNormal">
<br />
<b>The benefits of free
movement</b><br />
<br />
Free movement of labour has positive economic effects and if
we restrict it we become worse off on average. But it also brings with it
some disruption and there may be some who lose from it. The role of government
should not be to prevent free movement and in doing so lose those gains, but to
see that the long term benefits are enjoyed widely and the negative effects on
those whose lives may be disrupted are recognised and addressed. </div>
<div class="MsoNormal">
<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A continent of walled-off labour markets with governments as
gatekeepers arbitrating movement of workers between them would be less
productive, less flexible, and less dynamic. In economic terms, a vote to begin
erecting those walls would be a vote for a step backwards.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://www.cream-migration.org/personneldetail.php?id=4" target="_blank">Ian
Preston</a> is the Deputy Director of CReAM and Professor in the
Department of Economics at UCL.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Acknowledgement: </b>This piece was published first
at <a href="https://www.opendemocracy.net/brexitdivisions/ian-preston/confident-uk-has-nothing-to-fear-from-free-movement-of-labour">Open
Democracy</a><o:p></o:p></div>
<br />
<div class="MsoNormal">
<br /></div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-65707974620533518032015-10-08T12:40:00.002+01:002015-10-08T12:59:32.460+01:00Fact Check: is there zero economic benefit from high immigration?<div class="MsoNormal">
<b>By Ian Preston</b><o:p></o:p><br />
<b><br /></b>
<span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13.2px; line-height: 18.4667px;">Centre for Research and Analysis of Migration (CReAM) at University College London</span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The evidence – from the <a href="http://www.keepeek.com/Digital-Asset-Management/oecd/social-issues-migration-health/international-migration-outlook-2013/the-fiscal-impact-of-immigration-in-oecd-countries_migr_outlook-2013-6-en#page36">OECD</a>,
the <a href="http://www.publications.parliament.uk/pa/ld200708/ldselect/ldeconaf/82/82.pdf">House
of Lords Economic Affairs Committee</a> and many academics – shows that
while there are benefits of selective and controlled immigration, at best the
net economic and fiscal effect of high immigration is close to zero. So there
is no case, in the national interest, for immigration of the scale we have
experienced over the last decade.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Theresa May, home secretary, speaking at the <a href="http://www.independent.co.uk/news/uk/politics/theresa-may-s-speech-to-the-conservative-party-conference-in-full-a6681901.html">Conservative
Party Conference</a> on October 6, 2015.<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Evaluating the home
secretary’s claim requires recognising that the economic effects of immigration
have several dimensions. Although she says the overall impact is close to zero,
she bases that on several specific claims.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The first point of
concern is how immigration affects the labour market. It is easy to tell <a href="http://www.niesr.ac.uk/blog/anecdotal-evidence-chocolate-pret-and-general-equilibrium">anecdotes</a> about
how immigration harms job prospects in receiving countries – but this can be
misleading. Immigrants compete with similarly skilled workers but they also
create demand for jobs by spending their income. Just like other forms of
population growth, economies absorb immigration in many ways: importing
capital, adjusting the composition of goods produced, adjusting training and
technology.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The effect on wages
has been heavily researched <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=10">in
many countries</a> and evidence of large effects has indeed been <a href="http://www.ucl.ac.uk/~uctpb21/doc/CDP_11_08.pdf">difficult to find</a>.
There are <a href="http://qje.oxfordjournals.org/content/118/4/1335.short">exceptions</a>,
but the predominant conclusion is that immigration does not harm wages or
employment.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Elsewhere in her
speech, May contests this. She admits that migration can help “plug skills
shortages” and bring talent in but makes specific negative claims about low
wages and employment. She says that “we know that for people in low-paid jobs,
wages are forced down even further while some people are forced out of work
altogether”. More strongly, she argues that “there are thousands of people who
have been forced out of the labour market, still unable to find a job.”
Immigration control is needed: “For the sake of the people whose wages are cut,
and whose job security is reduced, when immigration is too high.”<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>What happens to wages<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
What we do know
about <a href="http://www.migrationobservatory.ox.ac.uk/briefings/labour-market-effects-immigration">immigration
to the UK</a> is that immigrants are, on the whole, <a href="http://cep.lse.ac.uk/pubs/download/ea019.pdf#page=6">well-qualified</a> but
nevertheless tend to work initially in less well-paid jobs. There is <a href="http://www.oxfordjournals.org/our_journals/restud/prpaper.pdf">some
evidence</a> from comparisons across regions that wage changes and
immigration are most strongly associated in those jobs where immigrants work in
the early years after arrival.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
This could provide
some justification for claims about wages – but it is subject to caveats. The
effects are very small and immigrants move up to higher paying jobs the longer
they stay so it is likely that such effects will disappear over time.
Furthermore, there are counterbalancing wage gains in parts of the labour
market where immigrants are not found and these more than compensate overall.
On average, if wages gain from immigration then it ought to be possible to
compensate those who lose and <a href="http://blog.oup.com/2012/07/what-effect-does-immigration-have-on-wages/">to
benefit collectively</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
As regards effects
on employment, no convincing evidence exists to support the claim that
immigration depresses it. <a href="http://cep.lse.ac.uk/pubs/download/ea019.pdf#page=8">Several studies</a> have <a href="http://onlinelibrary.wiley.com/doi/10.1111/j.1468-0297.2005.01038.x/abstract">failed
to find</a> an <a href="http://www.niesr.ac.uk/sites/default/files/publications/090112_163827.pdf">effect</a>.
Work from within the government’s Migration Advisory Committee <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/257235/analysis-of-the-impacts.pdf">found
evidence of association</a> between one sort of migration in one period
and changes in employment but the report in question is itself careful to point
out that it is <a href="http://creamcomments.blogspot.co.uk/2012/01/16th-january-2012-some-thoughts-on.html">not
very robust</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
So overall, it’s
possible to argue that the effect on the labour market of high immigration is
small but not to support some of the other claims made about the labour market.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Positive effect on public finances<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A second aspect of
economic effect is the effect on the public sector. What we know here is that
in the ten years since 2001 the best evidence, trying to account
comprehensively for effects through all taxes and all components of public
spending, is that migration <a href="http://www.voxeu.org/article/fiscal-effects-immigration-uk">impacted
public finances positively</a>, particularly migration from within the EU but
also from outside. This was at a time of overall fiscal deficit when the
average British-born person was contributing negatively, as the graph below
shows.<o:p></o:p><br />
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="clear: right; float: right; margin-bottom: 1em; margin-left: 1em;"></a><br />
<div class="separator" style="clear: both; text-align: center;">
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj4EBEYx9iTSW2OqcuQU2liVc9-X6K74e22wG05cdA0mIXCvR8O5UxABN4NszjVTE3yrys7jaimEqshCNpVRsEIySsomLxYAmncLTTAcvD8XVMYibis_lW2P_eRbPjDCTtJP-7gwnCanc0/s1600/image-20151006-7352-5vt07b.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="212" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj4EBEYx9iTSW2OqcuQU2liVc9-X6K74e22wG05cdA0mIXCvR8O5UxABN4NszjVTE3yrys7jaimEqshCNpVRsEIySsomLxYAmncLTTAcvD8XVMYibis_lW2P_eRbPjDCTtJP-7gwnCanc0/s400/image-20151006-7352-5vt07b.png" width="400" /></a></div>
<div class="separator" style="clear: both; text-align: center;">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"></a></div>
<br /></div>
<div class="MsoNormal">
<div class="separator" style="clear: both; text-align: center;">
<a href="https://www.blogger.com/blogger.g?blogID=7277104189105966427" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"></a></div>
<br /></div>
<div class="MsoNormal">
Ratio of revenues to
expenditures for natives and recent immigrants from inside and outside Europe,
2001-2011 <a href="http://www.voxeu.org/article/fiscal-effects-immigration-uk">Centre for
Research and Analysis of Migration, UCL</a><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Concerns about the
prevalence of <a href="https://theconversation.com/hard-evidence-does-benefits-tourism-exist-22279">welfare
tourism</a> receive scant support from this source since immigrants are
actually found to be <a href="https://theconversation.com/yes-eu-immigrants-do-have-a-positive-impact-on-public-finances-33815">less
likely to claim</a> than British residents.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Whether this effect
is “close to zero” or not depends what it is being compared to. As a fraction
of the overall deficit over the period it is small but on a per-immigrant basis
it is more impressive. This is just the short term impact and a <a href="http://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf#page=14">fuller
assessment</a> would need to look to the long-term when young, healthy,
working immigrants will age, some possibly return to places of origin, and some
bring up children whose taxes will contribute.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The home secretary
also mentioned effects on specific services, claiming that:<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<i>when immigration is too high, when the pace of change is too fast, it’s
impossible to build a cohesive society. It’s difficult for schools and
hospitals and core infrastructure like housing and transport to cope.</i><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Even if immigrants
are paying enough to cover the costs, it is still sensible to worry about <a href="http://www.voxeu.org/article/immigration-and-public-finances">effects on
service provision</a> which will matter economically to people using those
services. Evidence suggests that immigrants are <a href="http://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf#page=9">not
less healthy</a> than the British-born, use the NHS <a href="http://onlinelibrary.wiley.com/doi/10.1111/j.1475-5890.2013.00177.x/abstract">no
more intensively</a> and immigration may actually be associated with <a href="http://www.bsg.ox.ac.uk/research/working-paper-series/working-paper-005">shorter
waiting lists</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Immigrants, of
course, provide a <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=13">disproportionate
share of certain NHS staff</a>. Immigrants able to work are <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=19">not
more likely</a> to <a href="http://wol.iza.org/articles/crime-and-immigration">commit crime</a>. The
presence of non-English speaking children is <a href="http://www.voxeu.org/article/language-barriers-impact-non-native-english-speakers-classroom">not
deleterious</a> to English-speaking children’s education. There are
certain respects in which immigrants have a clearly positive contribution to
education, for example through <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=15">overseas
university fees</a>. Effects on <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=17">housing</a> and
transport are less well-researched.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The home secretary
finished her speech by concluding that “there is no case, in the national
interest” for large scale immigration. A full evaluation of this claim would
need to take account of other aspects to the economic impact about which
evidence is thinner. The economic case is not based so much on the scale of
migration as perhaps on limiting migration restrictions which prevent firms
from searching widely for skills and workers moving to where there are jobs. There
is some suggestive and plausible evidence, largely from outside the UK, that
immigration promotes <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=7">innovation,
entrepreneurialism</a> and <a href="http://www.voxeu.org/article/immigration-trade-and-productivity-services">trade</a> in
ways that will boosts growth.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Verdict<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
It is true that the
labour market impacts of immigration on British-born workers are plausibly
close to zero – but that contradicts claims made elsewhere in the home
secretary’s speech. Fiscal effects, on the other hand, at least in the short
term, are not close to zero but positive. A full assessment of economic
arguments for immigration would have to go beyond these effects.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Acknowledgement:</b> This piece was first published at <a href="https://theconversation.com/fact-check-is-there-zero-economic-benefit-from-high-immigration-48704" target="_blank">The Conversation</a><o:p></o:p></div>
<br />
<div class="MsoNormal">
<br /></div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-69218600582773518212015-10-08T11:52:00.005+01:002015-10-08T12:41:30.410+01:00Free movement, welfare tourism and refugees<div class="MsoNormal">
<b>By Ian Preston<o:p></o:p></b></div>
<div class="MsoNormal">
<br />
<span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13.2px; line-height: 18.4667px;">Centre for Research and Analysis of Migration (CReAM) at University College London</span><br />
<span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13.2px; line-height: 18.4667px;"><br /></span></div>
<div class="MsoNormal">
Ian Preston Deputy
Director of <a href="http://www.cream-migration.org/index.php" target="_blank">CReAM</a> and
Professor of Economics at UCL, puts forward the case for freedom of movement
within the European Union. He explains how freedom of movement and economic
migration is important for a dynamic and innovative economy, but it also brings
with it redistributive considerations that cannot be ignored. At a time when
many politicians conflate economic migration and asylum-seeking refugees, he
argues that the two are perhaps not entirely distinct from one another – and
discusses reasons why they shouldn’t be treated as one group.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Some economic
advantages of free movement of labour</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Free movement of labour, in the sense of absence of
restriction on European citizens’ rights of location for the purpose of work,
has been a longstanding goal of the European Union. But this goal has come
under increasing attack, from a variety of directions. Critics include not only
those hostile to European Union membership but also some who are professedly
sympathetic to membership but who appear sceptical about the benefits or long
term viability of unrestricted cross-border mobility of people in modern
Europe.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Judged in economic terms, the case for free movement of
labour, within or between countries, is strong since mobility of workers has
compellingly positive aspects.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
From the point of view of efficiency in production, free
movement allows workers to migrate to where their skills are most useful. If
particular industries are geographically concentrated or face local skill
shortages then they can recruit labour from a wider area. If workers have
talents which are undervalued where they live then they can move to where they
can be put to better use. High wages in locations of labour shortage will offer
the necessary signals to draw the migration required, allowing migrants to
capture part of the social gain from improved production.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
From the point of view of social protection, free movement
provides insurance against locally specific labour market shocks. If demand
intensifies unexpectedly in an area then labour can move in. If demand falls
within an area then labour can move out. The effects of temporary disturbances
are dispersed and variations in labour income are smoothed. When monetary
integration of different areas removes the possibility of macroeconomic
adjustment through exchange rate movements the importance of labour mobility as
an adjustment mechanism is even greater.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
From the point of view of growth, free movement allows ideas
to spread as people move so that innovators can work close to where their ideas
are most valued and innovations are therefore adopted widely. As they do so,
fresh encounters generate further new ideas.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
From the point of view of efficiency in public provision,
free movement allows better alignment of tastes and public service levels. If
individuals differ in preferences for the type or level of locally publicly
provided goods then free movement allows a better matching of wants and
provision. Individuals who are prepared to pay higher taxes for better services
can move to localities where this is offered and those less interested can move
to areas with lower provision. Public sector economists recognise this as one
way that a sort of invisible hand can work to a limited extent even where goods
are collectively consumed and therefore best provided through the public rather
than private sector. Of course, much public provision is of privately consumed
services and considerations here are more complex, as discussed below, but the
point is not eliminated.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
For all of these reasons, “economic migrant” has never been
a pejorative term among economists. On the contrary, economic migration is seen
predominantly as a force for good.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Some economic
drawbacks of free movement of labour</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Even outside circles of economists, considerations of this
sort are taken for granted as regards migration within a country. It would be
considered absurd and economically unwise to propose limitations on movement of
British workers from Birmingham to London. And yet, at the supranational
level, limitations on free movement within Europe are argued for and thought to
attract political support.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Why? In large part, this is because the politics of
migration is not about economics. Economic migration drives social change which
attracts strongly different reactions from the culturally conservative and the
socially liberal. Population movements are swelled by humanitarian crises which
draw sympathy differently in different parts of the population.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Nonetheless, even in economic terms, free movement is not
popular. Partly this may be because, despite persuasive reasons to think
the better geographic distribution of labour that results is a good thing on
average, not everyone gains. The principal beneficiaries are migrants
themselves who move because they can earn better wages where they go to than
where they come from. The picture for nonmigrants is likely to be mixed —
beneficial undoubtedly for some but potentially difficult for those competing
most closely with incomers or whose productivity would have benefited from the
presence of outgoers. The best evidence suggests that such effects are small
and probably temporary but they are what matter to the immobile and the
immobile both outnumber the mobile and are politically better represented.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
This is not the biggest economic issue though. Perhaps most
prominent among the economic fears of what migration involves in practice is
the concern that what prompts movement between countries may be exploitation of
differences in generosity of welfare systems and other redistributive parts of
public spending. Migrants, it is argued, arrive in richer countries to
claim benefits to which they have not contributed, and to draw on health and
education systems for which they have not paid.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Such problems rarely arise from movement within countries
because, sensibly, redistributive functions are typically centralised. There is
no different welfare system in different parts of the UK and resource
allocation formulae attempt to channel funds for provision in kind fairly to
different parts of the country. This is as it should be. While there can be
advantages to differing local provision of goods consumed in common, as argued
above, privately consumed services with a redistributive aspect cannot be
decentralised without threatening to generate potentially self-defeating
movement of people. Reasons would be created for those most in need to
move to the most generous areas and for those most able to pay to move away,
defeating the feasibility of effective redistribution.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
No similar centralisation of redistributive activities is
politically feasible at the European level because insufficient cross-border
social solidarity exists relative to the inequalities that would need to be
addressed. So redistribution remains largely a country-level function and fears
that differing national levels of generosity will prompt migration flows
generate calls for limits on migration. Benefit tourism is one side of this
just as tax tourism by the affluent is another; though rarely discussed
together and attracting the ire of different people, they are really similar
economic phenomena, just different kinds of redistribution shopping. Associated
hostility to migration can cross the political spectrum. Fears that the
national social solidarity that sustains what redistribution can be afforded by
national governments will be undermined by free movement creates a left-wing
case for concern.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
These observations have some force at an abstract level. But
they are no reason to pretend that the benefits to free movement detailed
earlier do not exist and are not substantial at a European level. Also, their
practical importance is an empirical question. To what extent do we actually
see welfare-seeking labour migration? Evidence is tenuous. Migrants are, on the
whole, predominantly young, well educated workers. At least in the short term
and over recent years, within EU migration has, for example, benefited the UK
fiscally even at a time of deficit when the average British born worker has
been a fiscal burden. EU migrants to Britain are less likely to claim benefits,
no more likely to use public health, no more likely to commit crime, and do not
compromise the education outcomes of native speakers. This is not the full
picture since that has to take account of long term implications as young
migrants age and impose future costs on welfare and health services. But some
of them will return to their place of origin and those who stay will raise
children who will pay towards their costs so there is no obvious reason not to
expect gains even considered in the long term. This positive picture is not a
necessary outcome and may not be true for all receiving countries; however, the
strength with which these concerns are voiced in the UK, for example, bears
little relation to any strength of evidence for them.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Because concerns about welfare tourism do seem so strong, a
case can be made for putting time limits on benefit claims by migrants,
enforcing a minimum period of residence before migrants can draw on certain
parts of benefit systems in countries of destination. What would be
positive about this would be that it might assuage concern that threatens to provoke
policy responses which would undermine real economic benefits. If migration is
indeed not largely benefit-driven then it should do little to reduce flows. The
economic cost though is that it would mean social insurance would be denied to
those moving for work.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Free movement and
refugees</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The political threat to the future of free movement predates
the current refugee crisis but has been exacerbated by it. Open borders
within the Schengen area have already been temporarily suspended by countries
struggling to manage the sudden size of the flows of people and doubts about
whether free labour mobility is sustainable are voiced even more loudly.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Decisions about the offer of asylum are governed, or should
be, by international humanitarian obligations. It is not clear that accepting
refugees need in any case be economically harmful. While past effects of
immigration may be a poor guide to the labour market and public finance impact
since refugees’ characteristics may differ from previous flows in ways difficult
to predict, there seems little reason to expect entrepreneurialism, initiative
and preparedness to work to be any lower than in past inflows. The notion that
the economic calculus of benefit receipt might suddenly be drawing large
numbers to undertake life-threatening boat crossings so as to exploit European
welfare systems also seems far-fetched.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Nonetheless the handling of short term difficulties of
sudden large flows raises questions about free movement of refugees. Confining
refugees to the first safe country which they reach, whatever its legal basis,
ties the short term costs of receiving large numbers to accidents of geography.
If those countries receiving heaviest flows in the first instance are also
those facing greatest current economic difficulties then the costs are made to
bear most heavily on those least well-prepared to cope. A system of
country-specific quotas is a popular idea for spreading the burden of
adjustment in the short term but can only work as intended if restrictions on
refugees’ subsequent mobility prevents movements which unravel the quotas.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Yet all the economic arguments made above for allowing long
term free movement apply. Allowing refugees to choose to go to where they can
best find work, where their skills and competences are most valued and where
they expect to feel most welcome harnesses refugees’ own wish to find the best
lives for themselves and their families to best economic advantage rather than
letting the most alarmist economic fears drive policy.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There is an unhelpful tendency of some rhetoric to contrast
refugee migration and economic migration. The suggestion that rigorous
discouragement of economic migration is the only way to accommodate a welcoming
policy towards those fleeing persecution should, for instance, be resisted. One
is not deserving and the other undeserving, as if seeking a better life is
politically tolerable only when the alternative is persecution. The potential
for economic migration to promote positive outcomes should be celebrated for
itself.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://www.cream-migration.org/personneldetail.php?id=4" target="_blank">Ian
Preston</a> is the Deputy Director of CReAM and Professor in the
Department of Economics at UCL.<o:p></o:p></div>
<div class="MsoNormal">
<span style="background: white; color: #222222; font-family: Arial, sans-serif; font-size: 10pt; line-height: 107%;"><br /></span></div>
<div class="MsoNormal">
<span style="background: white;"><b>Acknowledgement: </b>This piece was published first at</span><span style="background: white; color: #222222; font-family: Arial, sans-serif; font-size: 10pt; line-height: 107%;"> </span><a href="http://britain-europe.com/2015/10/07/free-movement-welfare-tourism-and-refugees/#more-738" target="_blank">European Institute blog poston Free Movement </a></div>
<div class="MsoNormal">
<o:p></o:p></div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-5499946410667569362015-10-08T11:16:00.001+01:002015-10-08T11:38:38.894+01:00Why Theresa May is Wrong About Immigration<div class="MsoNormal">
By <a href="http://europe.newsweek.com/authors/christian-dustmann"><b>Christian
Dustmann</b></a> , <b><a href="http://europe.newsweek.com/authors/ian-preston">Ian Preston</a></b><o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
Centre for Research and Analysis of Migration (CReAM) at
University College London<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
When Theresa May says that "at best the net economic
and fiscal effect of high immigration is close to zero" and that
"there is no case, in the national interest, for immigration of the scale
we have experienced over the last decade," she is ignoring persuasive
arguments that immigration may in many cases be economically beneficial.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Severe restrictions on migration of labor prevent businesses
from looking widely for skills they need and prevent workers from moving where
their labor is most valued. There is suggestive evidence that migration may
promote growth through encouraging innovation, trade and entrepreneurship.
While public concern over <a href="http://europe.newsweek.com/net-migration-hits-record-high-britain-332126">the
scale of migration</a> in recent years is undeniable, to minimize the
economic benefits as May does distorts what we know about how the economy
responds to immigration.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://europe.newsweek.com/british-home-secretary-hardens-stance-immigration-334179">May
argues that</a> "for people in low-paid jobs, wages are forced down
even further [by high immigration] while some people are forced out of work
altogether." These are strong statements, not confirmed in the academic
literature.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The labor market effect of immigration is in fact a subject
that has been comprehensively studied <a href="http://europe.newsweek.com/germany-needs-hundreds-thousands-migrants-tackle-skills-shortage-324124">in
many countries</a> over many years, and few studies have been able to pick
up the sort of negative impacts that she speaks about. This is true as much in
the U.K. as it is elsewhere. Evidence on newcomers to the U.K. shows that they
are typically better-qualified than the British-born workforce, but
nevertheless tend to work initially in less well-paid jobs, downgrading while
they pick up skills specific to the new labor market.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Regional comparisons of what happens to wages at different
points in the distribution suggest that it may well be in those lower parts of
the wage distribution—where immigrants work in early years after arrival—that
impacts on wage are felt. However, estimated effects are small and, since
immigrants tend to move up the wage distribution as they stay longer in the
country, these impacts are quite probably temporary. Moreover, there are
counterbalancing wage gains higher up the wage distribution and the overall
effect is, if anything, positive. As regards effects on employment, no
convincingly robust evidence exists that employment of the British-born is
harmed.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The other aspect concerns public finances and delivery of
public services. Far from the effects here being "close to zero," the
best evidence we have suggests that, in the decade from 2001 onwards, migrants
contributed more to the public exchequer than they took out. This applies
particularly to migrants from within the EU but also non-EU migrants, and this
was at a time of overall fiscal deficit, when the average British-born person
was contributing substantially negatively. Critics of migration often point to
supposed 'welfare tourism,' but immigrants are actually less likely to claim
benefits than British residents.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The Home Secretary also points to effects on specific
services, claiming that "when immigration is too high, when the pace of
change is too fast, it's impossible to build a cohesive society. It's difficult
for schools and hospitals and core infrastructure like housing and transport to
cope." The positive exchequer costs discussed above, comprehensively
measured in the sense that they include estimates of burdens through use of
public services, indicate that migrants' taxes more than cover the costs which
they impose.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Moreover, evidence suggests that immigrants are no less
healthy than the British-born and use the NHS no more frequently. Immigrants
with work opportunities are not more likely to commit crime. The presence of
non-English speaking children is not harmful to English-speaking children's
education. Income from overseas university students is beneficial to higher
education. Immigrants provide a disproportionate share of staff in much of the
public sector.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There will, of course, be short-term costs of adjusting to
cope with inflows of new people, but alarmism should not distract from fact
that immigration is fiscally beneficial and not harmful to the public sector.
In the end, politicians need to adjust public services to immigration-induced
demographic change—in the case of the U.K., recent immigrants have contributed
what is needed towards the cost of adjustments required.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<br />
<div class="MsoNormal">
<i><a href="http://www.cream-migration.org/personneldetail.php?id=2" target="_blank">Christian
Dustmann</a> and <a href="http://www.cream-migration.org/personneldetail.php?id=4" target="_blank">Ian
Preston</a> are professors of economics at University College London
(UCL). Dustmann is the director of the <a href="http://www.cream-migration.org/" target="_blank">Centre for Research and
Analysis on Migration </a>(CReAM) at UCL.</i><o:p></o:p></div>
<div class="MsoNormal">
<i><br /></i></div>
<div class="MsoNormal">
<b style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13.2px; line-height: 18.4667px;">Acknowledgement</b><span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13.2px; line-height: 18.4667px;">: This piece was published first on <a href="http://europe.newsweek.com/why-theresa-may-wrong-about-immigration-334205" target="_blank">Newsweek</a></span></div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-90306195810087893502015-05-06T15:54:00.000+01:002015-05-06T15:54:26.408+01:00Analysis: The migration conversation<div class="MsoNormal">
<b>by Ian Preston </b><o:p></o:p></div>
<div class="MsoNormal">
<o:p> </o:p> </div>
<div class="MsoNormal">
What do the election manifestos say about migration? Ian
Preston, professor of economics at University College London, gives his
analysis.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Of the five main nationwide parties, three – UKIP, the
Conservatives and Labour – emphasise in their manifestos a need to deal with the negative
aspects of immigration. UKIP argues that the high inflows of the past two
decades have damaged labour market prospects of the British-born and placed
pressure on public services. By withdrawing from the EU, it proposes to
introduce a visa system covering migration from all sources which would place a
five-year moratorium on any unskilled migration and heavily restrict the
numbers of visas issued for high-skilled labour.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The Conservative Party also stresses the harm to public
services and re-endorses an aspiration to cut net migration to the tens of
thousands. Labour, without committing itself on whether or not such concerns
are justified, acknowledges a need to address public concern on labour market
and public service effects. None of these propose any significant
relaxation and all propose at least modest tightenings in certain respects.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
By contrast, the Liberal Democrat and Green manifestos
concentrate on the positive side of the free flow of people. Their policies are
correspondingly modestly liberal, at least proposing to reverse some
tightenings introduced by the outgoing government. Both would reintroduce some
sort of post-study work visa for foreign students, scrapped in 2012. The Greens
would also scrap minimum income requirements for spousal immigration, a measure
brought in during 2012.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The labour market impact of immigration is something that
economists have studied in depth in many countries. Little persuasive evidence
has emerged to support a picture of adverse effects on average wages or on
employment, either in the UK or elsewhere. Economies appear to have many ways
to adapt to absorb changes in the size and composition of the labour force
without native employment or average wages needing to suffer. Immigrants to the
UK are typically young and well-educated but nonetheless work, at least in the
early years after arrival, towards the lower end of the wage distribution. If
there are any negative effects on wages, they are probably felt here, albeit
that such effects if they exist are small and probably temporary. Some of the
manifestos do show particular keenness to address effects on the least well
paid.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Immigrants make use of public services and rapid changes in
numbers may involve costs of adjustment. However, evidence suggests that
immigrants use public health services no more intensively than natives, that
the presence of non-English speaking children in schools does not hinder
education of native children and that immigration is unassociated with
increases in crime. Nor do immigrants draw heavily on welfare benefits; on the
contrary, recent immigrants are less likely to claim than natives. Empirical support
for the idea of extensive welfare tourism is tenuous.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
What immigrants do do is pay taxes and they do so to an
extent that means that, broadly considered, the net fiscal contribution of
immigrants since the turn of the century has almost surely been positive,
particularly in regards to immigrants from within Europe but also those from
outside. This is at a time when there have been large public deficits. From the
point of view of public finance, immigration therefore helps relieve the burden
of public service provision rather than adding to it. Of course, over time,
young and healthy immigrants will age and draw more heavily on the public
sector, but some will return to their place of origin and those who stay will
raise children who will help pay for their needs.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
These are not the only economic effects of immigration.
Suggestive evidence from the US and elsewhere points to the positive
contribution free movement can make to innovation, trade and entrepreneurship.
None of these issues figure in the discussion within the manifestos but their
importance is possibly greater than any of the feared labour market or public
service provision effects which do seem to concern the parties.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
It is understandable that immigration can give rise to
public concern because its problematic aspects may be the most immediately
visible. When an immigrant, say, takes a job that might have gone to someone
British-born or sits ahead of someone British-born in the wait to see a doctor,
this is more easily observed than when the same immigrant creates demand for
work by spending their income or helps fund public services by paying their
taxes. Failing to address public concern may leave it to grow and will
encourage public disillusionment.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Nonetheless, if one looks at opinion survey data, not only
in the UK but across Europe, then one has to doubt whether economic issues are
at the root of most public disquiet. Although it is the older, less educated
voters – those arguably most vulnerable to labour market competition or most
dependent on public services – who are least accepting of immigration, the
strongest associations with attitudes to immigration are not with opinions about
its economic consequences but with responses to its cultural and social impact.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13.1999998092651px; line-height: 18.4799995422363px;">Acknowledgement:</b><span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13.1999998092651px; line-height: 18.4799995422363px;"> This piece was published first at <a href="https://www.blogger.com/goog_1970694854">The Geographical</a></span><span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13.1999998092651px; line-height: 18.4799995422363px;"><a href="http://www.geographical.co.uk/uk/2015-general-election/item/1006-the-migration-conversation" target="_blank">.</a></span></div>
<br />
<div class="MsoNormal">
<br /></div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-24322346606019666462015-04-24T15:22:00.003+01:002015-04-27T11:50:55.572+01:00Here’s where Britain’s political parties stand (and fall down) on immigration<div class="MsoNormal" style="background: white; line-height: 13.85pt; margin-bottom: .0001pt; margin-bottom: 0cm;">
<div class="MsoNormal">
<div class="MsoNormal">
<b>by Ian Preston</b><o:p></o:p></div>
<div class="MsoNormal">
<br />
Centre for Research and Analysis of Migration (CReAM) at University College
London<o:p></o:p></div>
<div class="MsoNormal">
<br />
Immigration clearly ranks as <a href="https://www.ipsos-mori.com/researchpublications/researcharchive/3542/EconomistIpsos-MORI-March-2015-Issues-Index.aspx">one
of the most important issues</a> for voters in the lead up to the UK’s
election. But public opinion doesn't always match up with the evidence, and
political parties can be led in different directions by both. With this in
mind, the following takes stock of the different policies about immigration, as
outlined in the parties' manifestos.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Where do they stand?</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="https://theconversation.com/(https:/theconversation.com/manifesto-check-on-immigration-ukip-offers-only-confusion-40274">UKIP</a> makes
the strongest claims about immigration causing harm. The <a href="https://theconversation.com/manifesto-check-conservatives-talk-tough-but-bring-nothing-new-on-immigration-40336">Conservative</a> and <a href="https://theconversation.com/manifesto-check-labours-immigration-policies-are-led-by-public-opinion-not-evidence-40109">Labour</a> manifestos
also tend to emphasise the negatives of immigration, real or perceived.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://b.3cdn.net/labouruk/e1d45da42456423b8c_vwm6brbvb.pdf#page=50">Labour
says</a> the number of low-skilled immigrants is too high and points to no
high-skilled categories where they’d welcome increase. Both the <a href="https://s3-eu-west-1.amazonaws.com/manifesto2015/ConservativeManifesto2015.pdf#page=31">Conservatives</a> and <a href="https://d3n8a8pro7vhmx.cloudfront.net/ukipdev/pages/1103/attachments/original/1429295050/UKIPManifesto2015.pdf#page=10">UKIP</a> want
migration to be lower overall. In their <a href="https://www.conservatives.com/~/media/files/activist%20centre/press%20and%20policy/manifestos/manifesto2010#page=32">2010
manifesto</a>, the Conservatives proposed to reduce net migration to the <a href="http://www.bbc.co.uk/news/uk-politics-13083781">tens of thousands</a> –
a “goal” which the coalition government <a href="http://www.bbc.co.uk/news/uk-politics-31638174">dramatically missed</a>.
This time around, the party refers only to an “ambition”.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In contrast, the <a href="https://theconversation.com/manifesto-check-lib-dems-take-a-more-liberal-approach-to-immigration-40259">Liberal
Democrats</a> and the <a href="https://theconversation.com/manifesto-check-the-green-party-offers-a-new-take-on-immigration-40186">Green
Party</a> stress the benefits of immigration. Both parties propose more
open policies, such as the restoration of post-study work visas for students
and – in the case of the Greens – the abolition of minimum income requirements
for the entry of spouses. The Greens are the most thoughtful on the global
context, but their openness toward immigration is tempered by some scepticism
toward immigration for business reasons or by the more affluent, citing worries
about impacts on small businesses and house prices.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Among parties standing only in some parts of the UK,
the <a href="https://theconversation.com/manifesto-check-snp-migration-plans-focus-on-international-students-40506">SNP</a>, <a href="https://theconversation.com/manifesto-check-plaid-cymru-wants-immigration-policy-to-address-welsh-needs-39589">Plaid
Cymru</a> and the <a href="http://allianceparty.org/document/manifesto/alliance-2015-westminster-manifesto#document">Alliance
Party</a> are all fairly liberal, and concerned with the regional
suitability of immigration criteria. Of the Northern Irish parties, the <a href="http://uup.org/assets/images/uup%20ge%20manifesto.pdf#page=20">Ulster
Unionist Party</a> and the <a href="http://dev.mydup.com/images/uploads/publications/DUP_Manifesto_2015_LR.pdf#page=9">Democratic
Unionist Party</a> support immigration in moderation, while the
nationalist <a href="http://www.sdlp.ie/site/assets/files/42192/westminster_manifesto.pdf#page=24">Social
Democratic and Labour Party</a> and <a href="http://www.sinnfein.ie/files/2015/Westminster_Manifesto_2015_web.pdf">Sinn
Féin</a> are more or less silent on the matter.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>An EU issue</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
UKIP’s approach is the most innovative and the most
restrictive. The party wants to make sharp cuts to levels of immigration; an
approach which is tied to their core proposal of withdrawing from the EU.
Instead, the party wants to establish a <a href="http://www.bbc.co.uk/news/uk-politics-29594642">points-based system</a> which
treats Commonwealth migrants comparably to European ones.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The Conservatives tie the issue of migration to a
renegotiation of the terms of EU membership, as do the UUP. These parties
question whether free movement meets the needs of established EU members. On
the other hand, the SDLP’s positive comments on “<a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/335088/SingleMarketFree_MovementPersons.pdf">free
flow of people</a>” within the EU is as close as the party comes to discussing
immigration.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
EU withdrawal is advocated also by several parties outside
the mainstream whose manifestos talk at length about immigration. The <a href="http://issuu.com/communist_party/docs/ge_manifesto">Communist Party</a> and <a href="http://www.socialist-labour-party.org.uk/SLP%20Manifesto%202015%20pdf.pdf#page=8">Socialist
Labour Party</a> on the left, for example, regard the EU as an
organisation promoting capitalist interests at workers' expense. Both propose
immigration policies outside the EU with humanitarian emphasis. The Socialist
Labour Party propose a policy of zero net migration with priority for
Commonwealth immigrants. For the <a href="http://www.englishdemocrats.org.uk/policies/full-manifesto.html#3.15">English
Democrats</a> on the right, withdrawal not only from the EU but from a
wide range of international agreements is regarded as essential to regaining
full border control.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Boon, or burden on benefits?</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
For several parties, concerns about immigration from the EU
focus on <a href="https://theconversation.com/hard-evidence-does-benefits-tourism-exist-22279">migrant
benefit claims</a>. Yet evidence suggests there is <a href="http://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf#page=5">little
reason</a> to consider this a serious problem, and that restricting
entitlements is unlikely therefore to discourage immigration.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The Conservatives, Labour, UKIP and DUP all want to delay
receipt of benefits by migrants in various ways. The Conservative and Labour
manifestos propose to rule out payment of <a href="http://www.theguardian.com/society/2012/oct/23/child-benefit-payments-outside-uk">child
benefit</a> for children abroad. This will raise issues with <a href="http://eulawanalysis.blogspot.co.uk/2014/11/amending-eu-free-movement-law-what-are.html">EU
law</a>, whether renegotiating terms of the UK’s EU membership or not.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Stresses on public services are a prominent theme in the
Conservative, Labour and UKIP manifestos alike. The Conservatives propose a
fund to alleviate such pressures, which bears similarities to a <a href="http://www.theguardian.com/uk/2010/aug/06/fund-impact-immigration-scrapped">fund
scrapped early in the last parliament</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The best evidence suggests that migrants <a href="http://www.voxeu.org/article/fiscal-effects-immigration-uk">pay taxes</a> which
more than cover the cost of benefits received, <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=9">in
cash</a> or <a href="http://www.voxeu.org/article/immigration-and-public-finances">in kind</a>.
The net contribution of migrants should alleviate the cost of providing public
services.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Where’s the evidence?</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Costs imposed by migrants on the <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=13">NHS</a> are
mentioned by the Conservatives, and are repeatedly emphasised in UKIP’s
discussion of immigration. In fact, immigrants are <a href="http://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf#page=9">typically
healthier</a> than natives on arrival, becoming more like them the longer
they stay, and make <a href="http://onlinelibrary.wiley.com/doi/10.1111/j.1475-5890.2013.00177.x/epdf">similar
use of health services</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Nonetheless, UKIP would require that most migrants arrive
with private insurance. Unsurprisingly, the issue is also prominent for
the <a href="http://nhap.org/wp-content/uploads/2015/04/National-Health-Action-Party-Election-Manifesto-2015.pdf#page=37">National
Health Action party</a>. It proposes that stronger efforts be made to <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/329789/NHS_Implentatation_Plan_Phase_3.PDF">recover
the costs</a> of treating migrants, but <a href="http://www.irr.org.uk/pdf2/Access_to_Health_Care.pdf">opposes refusing
treatment</a> to anyone on ethical, economic and medical grounds.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Crime is another issue raised by Conservatives, Labour and
UKIP in relation to immigration. In fact, evidence suggests migration is <a href="http://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf#page=9">unassociated</a> with <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=19">changes
in crime rates</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Housing also figures in some manifestos. The Conservative
party worry about use of social housing, and UKIP about housing shortages.
The <a href="https://www.greenparty.org.uk/assets/files/manifesto/Green_Party_2015_General_Election_Manifesto.pdf#page=71">Greens</a>,
on the other hand, worry about richer migrants pushing up house prices.
Research on <a href="http://www.nuffield.ox.ac.uk/People/sites/Stephen.Nickell/Publication%20Files/Too%20Many%20People%20in%20Britain-May%202012.pdf">migration
and housing</a> is still developing, but evidence does not point to strong
upward pressure on <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=17">house
prices</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Revival of student opportunity</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
UKIP alone discusses the burden which immigration imposes on
schools. Such a burden might simply arise from growing numbers, or it might
follow from the difficulty of educating children of mixed backgrounds together.
The <a href="http://www.voxeu.org/article/impact-immigration-educational-attainment-natives">international
evidence</a> on <a href="http://www.voxeu.org/article/how-immigrant-children-affect-academic-achievement-native-dutch-children">the
latter</a> is <a href="http://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf#page=8">ambiguous</a>,
but negative effects of high proportions of non-native speakers in the
classroom on the performance of British-born children <a href="http://www.voxeu.org/article/language-barriers-impact-non-native-english-speakers-classroom">seems
to be ruled out</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Instead, the treatment of foreign university students is the
biggest issue linking education and migration. Liberal Democrats, Conservatives
and Labour promise crackdowns on <a href="http://www.theguardian.com/education/2014/dec/02/students-private-higher-education-colleges-taxpayer-subsidy-benefits-nao-loans">bogus
institutions</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
UKIP and the <a href="https://d3n8a8pro7vhmx.cloudfront.net/libdems/pages/8907/attachments/original/1429028133/Liberal_Democrat_General_Election_Manifesto_2015.pdf#page=124">Lib
Dems</a> pledge to <a href="http://www.ons.gov.uk/ons/dcp171778_396645.pdf#page=17">separate students</a> in
official statistics. Since the Lib Dems are not proposing to base targets on
such statistics, the point of this is unclear. For UKIP, who do want to keep
immigration down, but are not so averse to students, it makes more sense to
exclude students from the count.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The most significant proposal here is reintroduction of
the <a href="https://www.gov.uk/government/news/major-changes-to-student-visa-system">post-study
work route</a>, abolished under the current government, whereby students are
permitted to work for two years after completing study. The Greens promise
unconditional restoration, Plaid and the SNP propose restoration for students
in Wales or Scotland, and the Lib Dems propose a reintroduction specifically
for STEM (science, technology, engineering and mathematics) graduates.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://www.voxeu.org/article/how-highly-educated-immigrants-raise-native-wages">STEM
students</a> have been <a href="https://theconversation.com/(http:/www.voxeu.org/article/international-graduate-students-are-critical-scientific-discovery">shown
to be particularly associated</a>) with <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=7">innovation,
trade and entrepreneurship</a> – <a href="http://www.theguardian.com/commentisfree/2015/mar/24/immigration-tax-skills-brilliance-quality-life">issues</a> which
are largely absent from the discussion about migration in any manifesto.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Little effect on labour</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
A <a href="https://fullfact.org/immigration/migration_policy_since_election-41297">cap
on skilled immigration</a> would be retained by Conservative, Labour and
UKIP. Indeed, UKIP would put a five-year moratorium on any unskilled
immigration whatsoever, and restrict skilled immigration to 50,000 visas per
year. By way of comparison, about <a href="http://www.migrationobservatory.ox.ac.uk/reports/highly-skilled-migration-uk-2007-2013">221,000
highly skilled non-student migrants</a> are estimated to have entered the
UK for work in the three years prior to 2013.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Evidence on how immigration affects <a href="http://cep.lse.ac.uk/pubs/download/ea019.pdf#page=8">average wages</a> and <a href="http://www.cream-migration.org/commentsarticle.php?blog=3">employment</a> finds
no significant adverse effects. If there are labour market effects, then they
hit <a href="http://blog.oup.com/2012/07/what-effect-does-immigration-have-on-wages/">workers
on the lowest wages</a>. The Conservatives, Labour, the Lib Dems and the Greens
all propose crackdowns on <a href="http://www.newstatesman.com/politics/2014/11/migrant-workers-are-being-exploited-uk-we-must-take-action">exploitation</a>,
through new legislation or greater monitoring.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Questions of <a href="http://www.ucl.ac.uk/~uctpb21/Cpapers/languageproficiency.pdf">language
proficiency</a> appear in the manifestos of Conservatives, Labour, Lib
Dems and Greens. The emphasis shifts from <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/420506/20150406_immigration_rules_appendix_b_final.pdf">testing
migrants' English</a> to offering English lessons, as the tone of the
manifesto becomes more liberal.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Regional differences</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
To the extent that labour market restrictions are set
nationally, they may be inappropriate for the demands of <a href="http://niesr.ac.uk/blog/migration-growth-and-jobs-positive-agenda">particular
regions</a>. <a href="https://www.partyof.wales/uploads/Plaid_Cymru_2015_Westminster_Manifesto.pdf#page=38">Plaid</a>,
the <a href="http://votesnp.com/docs/manifesto.pdf#page=9">SNP</a> and
the Alliance Party (in Northern Ireland) all call for greater regional
sensitivity of policy in various respects, and complain about policies set to
suit the south of England. But the unionist parties of Northern Ireland make no
similar calls, and the nationalist parties of Northern Ireland say nothing on
the issue.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
One respect in which policy may be regionally discriminatory
is nationally set <a href="https://www.gov.uk/government/collections/family-and-private-life-rule-changes-9-july-2012">income
thresholds</a> for <a href="http://www.parliament.uk/Templates/BriefingPapers/Pages/BPPdfDownload.aspx?bp-id=sn06724">family
union</a>, which may hurt families more in lower income regions. Some suggest
such policies are <a href="https://www.freemovement.org.uk/one-rule-for-the-rich/">intrinsically
unjust</a>. Plaid proposes a review; the Greens would drop the policy
altogether. The Conservatives alone propose a toughening, while UKIP worries
about <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/256257/Sham_Marriage_and_Civil_Partnerships.pdf">sham
marriages</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<a href="http://www.bbc.co.uk/news/uk-32205970">Full exit
checks</a>, <a href="https://fullfact.org/immigration/count_people_in_and_out_uk-37635">frequently
promised</a> and already <a href="https://www.gov.uk/government/publications/exit-checks-on-passengers-leaving-the-uk/exit-checks-fact-sheet">partly
delivered</a>, are proposed by Conservatives, Labour, Lib Dems and UKIP. Labour
and UKIP both promise to expand border staff.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Protecting the persecuted</b><o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
All main parties except the Conservatives reaffirm support
for <a href="http://migrationobservatory.ox.ac.uk/briefings/migration-uk-asylum">protecting
victims of persecution</a>. Labour, the Lib Dems and the Greens would end <a href="https://detentioninquiry.files.wordpress.com/2015/03/immigration-detention-inquiry-executive-summary.pdf">indefinite
detention</a>. The Lib Dems and the Greens go further, advocating <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/299415/Permission_to_Work_Asy_v6_0.pdf">allowing
asylum seekers to work</a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
For those whose asylum claims fail, the Greens suggest a
review of legal status, while the Lib Dems would abolish the <a href="http://www.redcross.org.uk/en/About-us/Advocacy/Refugees/Azure-payment-card">Azure
card</a> system. The Greens want applicability of legal aid to immigration
and asylum work extended.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>Acknowledgement</b>: This piece was published first at<a href="https://theconversation.com/heres-where-britains-political-parties-stand-and-fall-down-on-immigration-40511"> The
Conversation.</a></div>
</div>
</div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-55903225345192076072015-04-20T12:24:00.004+01:002015-04-20T12:43:02.860+01:00Manifesto Check: Lib Dems take a more liberal approach to immigration<div class="MsoNormal">
<b>by Ian Preston<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Centre for Research and Analysis of Migration (CReAM) at
University College London.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
When asked about immigration in the recent leaders' debate,
Nick Clegg sought to draw a distinction between <a href="http://www.itv.com/news/update/2015-04-02/nick-clegg-insists-there-is-good-and-bad-immigration/" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">“good” and “bad” immigration</span></a>. The Liberal Democrat manifesto does not try
to push this distinction. Immigration is presented as primarily a good thing.
The party believes in Britain as an “open, trading nation”, “within the
European Union and beyond” and celebrates openness to “visitors who boost our
economy”, “migrant workers who play a vital role in business and public
services” and “refugees fleeing persecution”.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Although the Liberal Democrats were part of a coalition that
has tightened immigration policy in several ways, in <a href="https://d3n8a8pro7vhmx.cloudfront.net/libdems/pages/8907/attachments/original/1429028133/Liberal_Democrat_General_Election_Manifesto_2015.pdf?1429028133" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">its manifesto</span></a>, the party positions itself to push for a relatively
liberal approach to future decision making.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<b>A liberal approach<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The post-study work visa – which allowed graduates of UK
universities to stay and work for up to two years – was removed by the
coalition government. Some commentators have <span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;"><a href="http://niesr.ac.uk/blog/migration-growth-and-jobs-positive-agenda#.VS6VYvnF9Y4" target="_blank">called</a> </span>for
its restoration. Although the party does not propose to fully reopen the route,
its manifesto does contain a proposal to <a href="https://www.gov.uk/government/news/major-changes-to-student-visa-system" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">reintroduce a post-study work visa</span></a> specifically for STEM (science,
technology, engineering and mathematics) graduates, if work is found within six
months of their degree.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Popular opinion tends to be <a href="http://www.migrationobservatory.ox.ac.uk/briefings/uk-public-opinion-toward-immigration-overall-attitudes-and-level-concern#kp5" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">relatively welcoming</span></a> to students as immigrants. And there is <a href="http://www.voxeu.org/article/how-highly-educated-immigrants-raise-native-wages" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">evidence from the US</span></a> that foreign-born STEM students in particular may
contribute significantly to innovation, productivity growth and wages in the
country they migrate to.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
High-skilled immigration from outside the European Union is <a href="https://fullfact.org/immigration/migration_policy_since_election-41297" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">currently capped</span></a>. The party commits itself to “continue to allow high-skilled
immigration to support key sectors,” but there is no specific word on what will
happen to the cap.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
More broadly, there is no mention of a <a href="http://www.bbc.co.uk/news/uk-politics-31638174" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">target for overall net numbers</span></a> of
migrants coming to the country. The manifesto does pledge that students will be
separated within official statistics. But it is difficult to see the purpose of
this suggestion if the number is not to be subject to a target, given that the
official statistics – which are <a href="http://www.ons.gov.uk/ons/guide-method/method-quality/quality/quality-information/population/quality-and-methodology-information-for-long-term-international-migration-estimates--ltim-.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">prepared to international standards</span></a> – already <a href="http://www.ons.gov.uk/ons/dcp171778_396645.pdf#page=17" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">distinguish students</span></a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The English language skills of immigrants are mentioned as
pertinent to employment prospects, and to schools. Language assessments are
proposed for new claimants of the Jobseekers Allowance. English lessons are to
be encouraged for parents, where schools have high proportions of pupils with
English as a second language.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<b>Better treatment for asylum seekers<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Several reforms to the treatment of asylum seekers are
announced. Indefinite detention is to be ended. The manifesto also promises to
abandon the <a href="http://www.redcross.org.uk/en/About-us/Advocacy/Refugees/Azure-payment-card" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">Azure card scheme</span></a>, which restricts where and how refused asylum seekers
can spend their weekly allowance, and effectively requires them to identify
themselves as such when they do.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There are also changes to asylum seekers' rights to work.
Typically, asylum seekers are <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/299415/Permission_to_Work_Asy_v6_0.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">not allowed to work</span></a>, unless their case has lasted over a year through no
fault of their own. The justification for the current policy is supposedly “to
protect local labour markets”. But this seems weak, given that there is no more
reason to think refugee migration should be <a href="http://cep.lse.ac.uk/pubs/download/ea019.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">harmful to local employment or wages</span></a> than economic migration. The manifesto promises, not only
to allow asylum seekers to work after six months, but to require work to be
sought as a condition of benefit receipt. In light of the evidence, this seems
sensible.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<b>Not a problem<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Rather than characterising immigration itself as a problem,
the manifesto pledges to “tackle weaknesses” in the immigration system, which
threaten to “undermine confidence” in it. The party proposes inspections,
efficiency improvements and reviews aimed at restoring faith in the system.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Fears about the effects of immigration on the labour market
and on public services <a href="http://creamcomments.blogspot.com/2012/02/attitudes-to-immigration.html" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">feature prominently</span></a> in <a href="http://www.bsa.natcen.ac.uk/latest-report/british-social-attitudes-31/immigration/introduction.aspx" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">assessments of public attitudes</span></a>. Yet there are <a href="http://www.cream-migration.org/commentsarticle.php?blog=3" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">reasons to doubt</span></a> how <a href="http://www.voxeu.org/article/immigration-and-public-finances" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">well-founded</span></a> such
fears are.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In the manifesto, there is no discussion – let alone
endorsement – of such concerns, but there is a proposal for annual assessment
of skill and labour market shortfalls and surpluses, impact on the economy,
public services and communities. <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/257235/analysis-of-the-impacts.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">Such assessments</span></a> are already regularly carried out by the <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/257241/mac-report.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">Migration Advisory Committee</span></a>. The manifesto proposes to make them annual, and
to put them at the centre of a presentation to parliament.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There are also promises to ensure tougher policing of abuses
of the system in both <a href="http://www.theguardian.com/education/2014/dec/02/students-private-higher-education-colleges-taxpayer-subsidy-benefits-nao-loans" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">education</span></a> and <a href="http://www.newstatesman.com/politics/2014/11/migrant-workers-are-being-exploited-uk-we-must-take-action" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">work</span></a>.
But these are not at all specific in the case of educational institutions, and
simply described as a doubling of inspections to check for compliance with
employment law in the case of employers.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Further proposed changes to the system appear to be mainly administrative.
The party pledges to ensure fast processing of work, tourist and family visas
and of asylum claims, but does not provide any details about how they are to be
achieved, and at what cost.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The promise to restore <a href="http://www.bbc.co.uk/news/uk-32205970" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">full exit checks</span></a> has
been <a href="https://fullfact.org/immigration/count_people_in_and_out_uk-37635" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">frequently made</span></a> by many parties, and <a href="https://www.gov.uk/government/publications/exit-checks-on-passengers-leaving-the-uk/exit-checks-fact-sheet" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">large steps</span></a> have already been made to implement it.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Except for a call for the speedy issue of visas, there is no
discussion of changes to policy on <a href="http://www.parliament.uk/Templates/BriefingPapers/Pages/BPPdfDownload.aspx?bp-id=sn06724" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">family migration</span></a>.<br />
<br />
<b>Acknowledgement:</b> This piece was published first at <a href="https://theconversation.com/manifesto-check-lib-dems-take-a-more-liberal-approach-to-immigration-40259" target="_blank">The Conversation</a>.</div>
<div class="MsoNormal">
<o:p></o:p></div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-81563423749778586132015-04-20T11:44:00.004+01:002015-04-20T12:38:18.088+01:00Manifesto Check: Labour’s immigration policies are led by public opinion, not evidence<div class="MsoNormal">
<b>by Ian Preston<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Centre for Research and Analysis of Migration (CReAM) at
University College London.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Labour’s commitment to controlling immigration had already
been made clear by its announcement as one of Labour’s <a href="http://press.labour.org.uk/post/105262118234/launch-of-labours-second-election-pledge" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">five election pledges</span></a>. But the party’s manifesto goes further to explain
the policies, and how they would be implemented.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The party declares that it wishes to “look outward”, while
recognising “public anxiety” and the people’s need “to feel secure in the
strength of our borders.” The manifesto identifies specific public concerns,
such as effects on wages, public services and “our shared way of life”. Public
anxiety is <a href="http://www.bsa.natcen.ac.uk/latest-report/british-social-attitudes-31/immigration/introduction.aspx" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">undeniable</span></a>,
and according to research, social concerns may be <a href="http://creamcomments.blogspot.com/2012/02/attitudes-to-immigration.html" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">more significant</span></a> than economic ones.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
No view is advanced by Labour as to whether these concerns
are well-founded: research suggests that economic concerns, for example, are
not. The evidence fails to point persuasively to any adverse impact <a href="http://cep.lse.ac.uk/pubs/download/ea019.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">on average wages</span></a> or <a href="http://www.cream-migration.org/commentsarticle.php?blog=3" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">employment</span></a>. As
regards public finances, research shows that recent immigrants both <a href="http://www.cream-migration.org/files/FiscalEJ.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">contribute more in taxes</span></a> than they <a href="http://www.voxeu.org/article/fiscal-effects-immigration-uk" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">withdraw in calls on public services</span></a> and provide much of the staffing
for <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=13" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">some parts of the public sector</span></a>.<o:p></o:p></div>
<div class="MsoNormal">
<br />
Restricting immigration might assuage public concern, but it
could also fail to achieve gains in average wages, and lead to less healthy
public finances.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<b>Different types of immigrants<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Public opinion distinguishes between <a href="http://www.migrationobservatory.ox.ac.uk/briefings/uk-public-opinion-toward-immigration-overall-attitudes-and-level-concern#kp5" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">different types of immigrants</span></a>. For example, the British public tends to be
more positive about students, highly-skilled migrants and close family members,
than about low-skilled economic migrants, extended family members, refugees and
those who enter or stay in the country illegally.<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
Labour’s manifesto promises to mildly tighten, or to
maintain the tightness of, restrictions on unpopular forms of migration.
Although the party mentions some of the benefits of some forms of immigration –
such as overseas students – it does not make any proposals to relax
restrictions for these groups.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The manifesto claims that under a Labour government,
immigration by serious criminals will be more strongly policed. Inevitably, immigrants
include some people who will commit crimes and some people who will be victims
of crimes. But many studies in a number of countries have failed to find <a href="http://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf#page=9" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">a convincing association</span></a> between <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=19" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">migration flows and crime rates</span></a>.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Labour also plans to crack down on the abuse of short-term
student visas, although how this policy will differ to the kind of tightening
that has <a href="http://www.timeshighereducation.co.uk/news/student-visa-rules-tightened-by-government/2014823.article" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">already been pursued</span></a> is unclear. There is a risk of <a href="http://www.voxeu.org/article/international-graduate-students-are-critical-scientific-discovery" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">discouragement to innovation</span></a> from limiting graduate recruitment and the party
welcomes the contributions of overseas students, but there are no explicit
proposals for changes to terms of entry for this group (such as reviving a <a href="http://niesr.ac.uk/blog/migration-growth-and-jobs-positive-agenda#.VSzCUPnF8kE" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">post-study work route</span></a>).<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Labour’s manifesto criticises the Conservatives for
undermining public trust by committing to a target <a href="http://www.bbc.co.uk/news/uk-politics-31638174" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">that was not met</span></a>. The
party makes no commitment to any defined number or cap on overall immigration,
and there is therefore no discussion about which types of immigrants should be
considered in any target. But the party does state a view that low skilled
migration “needs to come down” and does commit to retaining the <a href="https://fullfact.org/immigration/migration_policy_since_election-41297" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">cap on migration</span></a> for workers from outside the EU, currently set at
a little over 20 thousand for employer-sponsored skilled migrants.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<b>The European issue<o:p></o:p></b></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
In its section on Europe, the manifesto promises to “secure
reforms to immigration and social security rules, as well as pushing for
stronger transitional controls”. Evidence that <a href="http://www.ifs.org.uk/uploads/publications/Preston-2014-The_Economic_Journal.pdf#page=5" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">welfare tourism</span></a> is a <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf#page=19" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">serious problem</span></a> is actually slim, so the extent to which this might
substantially discourage European migration is doubtful. Nevertheless, the
party pledges to revoke the right to send <a href="http://www.theguardian.com/society/2012/oct/23/child-benefit-payments-outside-uk" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">child benefits abroad</span></a>, and promises to implement a two-year delay on
benefit receipt for EU migrants.<o:p></o:p></div>
<div class="MsoNormal">
<br />
The implementation of such policies would face issues of
compatibility with <a href="http://eulawanalysis.blogspot.co.uk/2014/11/amending-eu-free-movement-law-what-are.html" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">EU law</span></a>. As a result, how easy these changes are to implement will
depend on the extent to which they are regarded as inhibiting freedom of
movement for work, and on the negotiating abilities of a Labour government
within the EU.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Labour also promises to protect low wages against
exploitative immigration, with bans on recruitment agencies hiring exclusively
from abroad, and an extension of <a href="http://www.legislation.gov.uk/ukpga/2004/11/contents" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">Gangmaster Licensing law</span></a> (which currently covers only agriculture and food
processing). It is true that the strongest evidence of any negative effects of
immigration on wages occurs at the <a href="http://blog.oup.com/2012/07/what-effect-does-immigration-have-on-wages/" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">bottom end</span></a> of the distribution, so this measure seems appropriately
targeted.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Alongside these proposed tightenings, there are also
administrative changes. The party commits itself to <a href="http://www.bbc.co.uk/news/uk-32205970" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">full checks on exits</span></a>,
a <a href="https://fullfact.org/immigration/count_people_in_and_out_uk-37635" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">promise frequently made</span></a> by different parties over the past decade and <a href="https://www.gov.uk/government/publications/exit-checks-on-passengers-leaving-the-uk/exit-checks-fact-sheet" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">already partially implemented</span></a>. In principle, if realised, this should
improve monitoring of net migration numbers. More border staff are promised,
financed by a charge on non-visa visitors of a small – but unspecified –
magnitude.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There are some proposals to address rights and welfare of
migrants. There is a promise to end <a href="https://detentioninquiry.files.wordpress.com/2015/03/immigration-detention-inquiry-executive-summary.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">indefinite detention</span></a>, and to end detention altogether for pregnant women and
victims of trafficking and abuse. Labour pledges to provide refuge to genuine
victims of persecution, but there is no explicit commitment to numbers. The UK
currently <a href="https://theconversation.com/hard-evidence-how-much-are-european-countries-doing-to-help-shelter-syrian-refugees-38731" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">does less than its EU neighbours</span></a> in terms of sheltering Syrian
refugees.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
There is no mention of any change to rules on <a href="http://www.parliament.uk/Templates/BriefingPapers/Pages/BPPdfDownload.aspx?bp-id=sn06724" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">family migration</span></a>.<br />
<br />
<b>Acknowledgement:</b> This piece was published first at <a href="https://theconversation.com/manifesto-check-labours-immigration-policies-are-led-by-public-opinion-not-evidence-40109" target="_blank">The Conversation</a>.</div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-6140350025701457972015-04-20T11:24:00.000+01:002015-04-20T12:38:27.608+01:00Manifesto Check: Plaid Cymru wants immigration policy to address Welsh needs<div class="MsoNormal">
<b>by Ian Preston</b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Centre for Research and Analysis of Migration (CReAM) at
University College London.<o:p></o:p><br />
<br /></div>
<div class="MsoNormal">
Wales has a <a href="http://cep.lse.ac.uk/pubs/download/ea019.pdf#page=8" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">lower immigrant population</span></a> than almost any other region in the UK.
Plaid Cymru’s manifesto adopts an unabashedly positive tone, much more focused
on the benefits of immigration – referring to migrants as “world-class experts
and those who can help run our public services” – compared to what we might
expect from some of the other parties. Unsurprisingly, the need for immigration
policy to recognise the specific needs of Wales is a central theme. Plaid wants
to pursue immigration policies in accordance with the needs of the Welsh labour
market, but such changes could be difficult to implement in the current
context.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<b>One size doesn’t fit all<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Immigration rules are a form of labour market restriction
that may match the needs of some regions better than others. For instance,
restrictive policies based on a UK-wide assessment that there are no skill
shortages may be ill-suited to the needs of regions where skills are in short
supply – particularly if those regions find it difficult to attract skilled
workers from within the country.<o:p></o:p></div>
<div class="MsoNormal">
<a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/406775/Partial_review_of_the_SOL_for_UK_and_Scotland_Report.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">Assessmentsof skill shortages</span></a> made by the <a href="https://www.gov.uk/government/organisations/migration-advisory-committee" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">Migration Advisory Committee</span></a> (MAC) as a basis for decisions on visa
policy can take into account submissions by regional bodies, but are not
currently region-specific, except for the special consideration of <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/406775/Partial_review_of_the_SOL_for_UK_and_Scotland_Report.pdf#page=139" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">Scotland</span></a>.
The Plaid Cymru manifesto proposes the creation of a Welsh Migration Service to
assess Welsh skill needs and liaise with the MAC. It also contains a proposal,
for example, that the Welsh government should be allowed to decide which
companies can sponsor immigrant workers within Wales.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<b>Students and spouses<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
It also goes further, proposing relaxation of the
immigration policies specific to Wales. The case has been made for <a href="http://niesr.ac.uk/blog/migration-growth-and-jobs-positive-agenda" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">region-specificvisas</span></a> in the UK more generally, and this policy represents a
step toward the idea of region-specific visas for Wales.<o:p></o:p></div>
<div class="MsoNormal">
The manifesto proposes, for example, the reintroduction of
the post-study work route specifically for students at Welsh universities. This
would allow for overseas university students to remain within the country for a
period after completing their studies. This route was <a href="https://www.gov.uk/government/news/major-changes-to-student-visa-system" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">was scrapped by the UK government in 2012</span></a>, based on arguments that it
was prone to abuse and facilitated entry too easily into unskilled work. But it
can also be argued that scrapping this route was bad for national skill
retention and bad for university student recruitment. For Plaid’s policy to
work as intended, those granted the right to stay would need to be effectively
constrained to the Welsh labour market.<o:p></o:p></div>
<div class="MsoNormal">
The current UK government has also <a href="https://www.gov.uk/government/collections/family-and-private-life-rule-changes-9-july-2012" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">tightened entry rules for foreign spouses</span></a>, requiring a minimum income in
order, supposedly, to prevent immigrating spouses from becoming a fiscal
burden. <a href="http://crookedtimber.org/2011/11/19/britain-dont-marry-a-foreigner-unless-youre-rich/" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">Some argue</span></a> that <a href="http://www.theguardian.com/commentisfree/2014/dec/14/immigration-rule-change-assault-britishness-money-citizenship-rights" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">the whole idea</span></a> of restricting the right to live in the country with
a foreign-born spouse by income <a href="https://www.freemovement.org.uk/one-rule-for-the-rich/" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">is unjust</span></a>. Since thresholds are set nationally, the policy is also
arguably regionally discriminatory. The Plaid Cymru manifesto proposes a
review.<o:p></o:p></div>
<div class="MsoNormal">
<b><br /></b></div>
<div class="MsoNormal">
<b>An unfair advantage?<o:p></o:p></b></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
The only respect in which the manifesto suggests a
tightening of policy is a strengthening of <a href="http://www.legislation.gov.uk/ukpga/2004/11/contents" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">gangmaster licensing law</span></a> – specific to agriculture and food processing –
so as to “protect local workers” and prevent “unfair advantage” being gained
through employment of migrants. <a href="http://cep.lse.ac.uk/pubs/download/ea019.pdf" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">There is evidence</span></a> that
immigrants tend to work <a href="http://blog.oup.com/2012/07/what-effect-does-immigration-have-on-wages/" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">at low wages</span></a>, at least in years soon after arrival. Whatever small negative
effects there are of this tend to be at that end of the wage distribution. The
proposal here is rather vague though, in terms of what is meant by “unfair
advantage”, and in how it would be policed.<o:p></o:p></div>
<div class="MsoNormal">
The manifesto also raises issues of immigrant welfare.
Specifically, it proposes that Wales become a “Country of Sanctuary” – an
extension to the <a href="http://www.cityofsanctuary.org/" target="_blank"><span style="mso-bidi-font-weight: bold; text-decoration: none; text-underline: none;">City of Sanctuary</span></a> idea – declaring Wales to be a place of safety for
those fleeing persecution. Particular mention is made of refugees from Syria
and Iraq. Finally, there is also a commitment to pursue prevention of slavery
which is surely unexceptionable.<o:p></o:p></div>
<br />
<div class="MsoNormal">
<b>Acknowledgement:</b> This piece was published first at <a href="https://theconversation.com/manifesto-check-plaid-cymru-wants-immigration-policy-to-address-welsh-needs-39589" target="_blank">The Conversation</a>.</div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-79054803998201613522014-05-30T17:13:00.001+01:002014-05-30T17:18:38.309+01:00What do we know about immigration?<b>by Christian Dustmann and Ian Preston</b><br />
<br />
Centre for Research and Analysis of Migration (CReAM) at University College London.<br />
<br />
<div class="MsoNormal">
In the current heightened political climate, consideration
of the factors which determine immigration policy should be based on the best
available evidence. We at the Centre for Research and Analysis of Migration
have composed a <a href="http://www.cream-migration.org/files/Migration-FactSheet.pdf" target="_blank">briefing</a>, intended to promote discussion that is informed and
not alarmist, low key and not polemical. In that note we point out the challenges
for researchers in measuring the social and economic consequences of
immigration, backed up with detail and references to appropriate academic study
in the respective field.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Restrictive immigration policies are a curtailment of
individual freedom of movement that causes real harm both to individuals
already in the receiving country and to potential immigrants. Families are
prevented from being together, innovative and productive economic relationships
are prevented from happening, fleeing persecution is made more difficult. To
justify this requires strong reasons and reasons that are rooted in evidence
rather than anecdote.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Advocates of tighter immigration control believe that reasons
can be found in negative consequences for receiving countries. For instance, wages may be depressed by
inflows of labour; changes in the character of receiving neighbourhoods may
cause cultural dislocation; pressure on public spending can worsen the state of
public finances; pressure on public services may lead to deterioration in the
quality of services to local populations.
All of these could, if true, be reasons for caution in immigration
policy but it is not obvious that any of them are true. Immigration could be
economically invigorating, promoting innovation and raising wages; local
cultures could be enriched by the diversity that comes with immigration; taxes
paid by young and productive immigrants could ease pressures on the public
exchequer; staff born abroad could be essential to delivery of public services.<o:p></o:p></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Whether or not any of these issues should be what determines
immigration policy, it is surely true that discussion should be driven by
something more substantial than hearsay and hunches. Measurement of the effects
of immigration on receiving countries is challenging, fraught as it is within
the need to separate genuinely causal from merely coincidental relationships
and there is a great deal still to be understood. Nonetheless, we find the
progress made by academic researchers in better understanding the phenomenon of
immigration and in opening up new avenues of research to be encouraging. New
scholars choosing migration studies as the topic of their academic career and
new data sources paired with new methodology have provided new insights into
phenomena that were previously not well understood. For instance, research is
making progress in understanding the impact immigration has on innovation and
entrepreneurship, on opportunities which immigration opens up for native-born
individuals and in assessing the effects immigration has on the labour market
and the economy of receiving countries, not just through employment and wage
adjustments, but also through new trade opportunities and technological
advances. In the briefing we try to summarise the best available research on
some of the most critical impacts.<o:p></o:p></div>
<br />
<div class="MsoNormal">
There are still many open questions that need addressing and
the balance of evidence can always shift as research progresses, but there
seems to us little basis in existing research to fear the consequences of or to
feel the need to apologise for supporting a relatively open and progressive
immigration policy.</div>
<div class="MsoNormal">
<o:p></o:p></div>
<div class="MsoNormal">
<o:p></o:p></div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-10722486269561183362014-03-12T16:40:00.003+00:002014-05-30T17:15:08.633+01:00Reply to the Report ‘An Assessment of the Fiscal Effects of Immigration to the UK’ by Migration Watch<div class="MsoNormal">
<b>by Christian Dustmann and Tommaso Frattini</b><br />
<b><br /></b>
Centre for Research and Analysis of Migration (CReAM) at University College London.<br />
<br />
Migration Watch (MW) has released for publication on Thursday 13 March 2014 a report entitled ‘An Assessment of the Fiscal Effects of Immigration to the UK’.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In this report MW claims that our research paper on ‘The Fiscal Effects of Immigration to the UK’ [<a href="http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf" target="_blank">http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf</a>], released on November 5 2013, has some flaws that invalidate our main results, namely that EEA immigrants who came to the UK since 2000 have contributed over the last 11 substantially more in revenues than they received in state expenditures. This contrasts with the UK-born, who over the same period contributed substantially less than they received.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
MW states that our main results – that EEA immigrants who came to the UK since 2000 have contributed over the last 11 years substantially more in revenues than they have received in state expenditures – is ‘simply wrong’ because it relies on the assumptions that that (page 7, point xi (a) of their report):</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
(1) [Migrant] employees earn the same as the UK-born population; (2) Self-employed migrants contribute far more than those employed; (3) Migrants own the same investments, property and other assets as the UK-born and long-term residents from the day they arrive in the UK. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Their first claim is simply incorrect. At no point do we make assumption (1). We rather allocate earnings (and the ensuing tax receipts) according to the figures on earnings for immigrants and natives that we obtain from the UK Labour Force Survey (LFS). </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Further, their second claim is also incorrect. At no point do we make assumption (2). In fact, in the absence of information on self-employed earnings, we allocate tax payments of the self-employed according to the shares of income tax payments computed for employees. This may rather lead to an <i>underestimate </i>of the income taxes paid by immigrants, as relatively more immigrants are self-employed. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Finally, we have responded to the third point in an earlier reply from November (ignored in the piece by MW), where we compute an extreme scenario where recent immigrants pay <i>no </i>corporate taxes and business rates whatsoever, and allocate these taxes to long term residents only. We still find that recent EU immigrant make a positive contribution, while the net contribution of natives remains negative.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
MW’s main criticism is based on a fundamental misapprehension of what we are doing. MW’s main argument builds on a serious misinterpretation of the way we estimate income tax contributions and NIC payments of immigrants. MW claims that we assume that migrant employees earn the same as the UK-born population, and that self-employed migrants contribute more than those who are in salaried employment. But at no point do we make any of these assumptions, nor is there anything in our paper that suggests that in any way. It is therefore puzzling to us why their piece attacks our work so violently, based on a complete misapprehension of what we are doing. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
More precisely, data in the UK LFS does not collect information on self-employment earnings. Despite this shortcoming, the LFS is the best available data source for our purposes, as it contains consistent wage data and information on country of birth over a long time period. It is well known that the Annual Survey of Hours and Earnings (ASHE) that MW suggests as a more reliable data source (point 36, page 23) does not contain information on the earnings of self-employed either, and, more importantly, does not have any information on country of birth, which is obviously crucial for analysis on the fiscal impact of immigration.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Thus, in the absence of information on earnings of the self-employed, we use the LFS to construct the share of income tax and National Insurance contributions payments made by native and immigrant employees based on their reported earnings. We then use these shares to allocate the total amount of income tax and NIC revenues to immigrants and natives, including that paid by the self-employed. This strategy does not require making either assumption (1) or (2) above, as MW claims we do. Further, since self-employment is more common among recent EEA immigrants than among natives, this choice may lead to an <i>underestimate </i>of total EEA immigrant tax payments, exactly the opposite to what they claim.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
MW also criticises the way we have allocated corporate tax payments. We assume that company ownership (i.e. share ownership) is similarly distributed between the native and immigrant population, and we clearly state this assumption in our paper (page 13). MW’s criticism is not new, and we have already responded to it in an earlier reply [<a href="http://www.cream-migration.org/commentsarticle.php?blog=2" target="_blank">http://www.cream-migration.org/commentsarticle.php?blog=2</a>]. In the same reply, we also respond to a related criticism, which MW raises again, about the way we allocate business rate revenues, based on the share of self-employed in each population group. MW – and other commentators before – argued that this may be incorrect because business rates are primarily paid by large businesses.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
As an example, MW says that Sainsburys pays £400 million a year in business rates (no source is given). But as we explained in our earlier response, ‘<i>the allocation of corporate taxation and business rates raises complicated questions of incidence. The fact that businesses write the cheques does not mean that the burdens do not fall ultimately on people. Whether those people are customers, shareholders, property owners or whoever, depends upon how economic decisions and, as a consequence, prices respond to taxation and is not a straightforward question.</i>’ Coming back to MW’s example, the burden of business rates may be borne by consumers in terms of higher prices or local property owners in terms of lower rents, and so on.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
In our previous reply, we have also computed the total fiscal contribution of recent EEA immigrants under the extreme (and clearly implausible) assumption that recent immigrants do not pay <i>any </i>corporate taxes or business rates, and we have allocated these taxes to long term residents. Even in this case, which represents an extreme lower bound on the tax payments of recent immigrants, we still find that EEA immigrants made a substantial overall positive net fiscal contribution, while the contribution of natives remains negative. It is disappointing that MW ignores this reply in their piece.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
To summarise, MW’s main criticism is based on a stark misapprehension of our methodology. The report is written in a derogatory language seemingly attempting to undermine our reputation with suggestions that we do not adequately describe our methodology or comment on all our results. We are in fact very open about our methodology - which has been acknowledged even by earlier critics of our work (including Prof M. Stone, cited approvingly in their report, who comments that ‘we set out our assumptions with commendable clarity’ [page 3 here: <a href="http://www.civitas.org.uk/pdf/assumptionsandwizardry.pdf" target="_blank">http://www.civitas.org.uk/pdf/assumptionsandwizardry.pdf</a>]).</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
Their strongly worded criticism is all the more surprising as the MW report is based on a substantial amount of guesswork, does not provide clear indication of how their figures are computed, and is at times sloppy or simply wrong. For example, the authors must have misread section 2.2.3 of our paper and/or earlier research of ours (Dustmann, 1997; and Dustmann, Fasani and Speciale 2013), as this research never claims that the level of consumption for migrants may be 20% lower than that of the indigenous population. Also, there seem to be calculation mistakes in some of the figures in their tables.</div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
We welcome constructive criticism of our work, and we have engaged responsively and transparently with outside researchers who have raised criticisms since we believe that only an open and fact-based debate can do justice to a subject as sensitive as immigration. </div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
MW chose to circulate their critique to the media earlier this week without sending it to us so we have not had the chance to point out errors to them as we would have been able if they believed in conducting debate similarly openly. Although the report cites some of the reports that are critical of our work, MW has chosen to ignore detailed replies already made, notwithstanding the fact that they are easily available on the CReAM webpage [<a href="http://www.cream-migration.org/comments.php" target="_blank">http://www.cream-migration.org/comments.php</a>], were brought to their attention at the time, and already respond to some of their criticisms.</div>
<div>
<br /></div>
Unknownnoreply@blogger.com5tag:blogger.com,1999:blog-7277104189105966427.post-4822466725526150692014-01-29T09:04:00.004+00:002014-01-29T09:43:47.639+00:00There are no “Schoolboy Errors” in our report<b>by Christian Dustmann and Tommaso Frattini</b><br />
<br />
<a href="http://www.cream-migration.org/index.php" target="_blank">Centre for Research of Analysis and Migration (CReAM)</a> at University College London<br />
<br />
On January 2nd, Civitas published two reports on our paper The Fiscal Effect of Immigration on the UK on their website, and added a press-release entitled “Schoolboy errors in UCL report claiming fiscal benefit to immigration”. Reading the two reports carefully, it is puzzling what has led Civitas to this headline, and to some of the statements made in the press release.<br />
<br />
The first piece [<a href="http://www.civitas.org.uk/pdf/assumptionsandwizardry.pdf" target="_blank">http://www.civitas.org.uk/pdf/assumptionsandwizardry.pdf</a>] is by Prof. Mervyn Stone, an emeritus statistics professor at UCL.<br />
<br />
Prof. Stone thought that the report is <i>an ambitious and largely scholarly study, in which crucial assumptions (about how to share expenditures and revenue between immigrants and natives) are set out with commendable clarity – and are therefore open to a degree of critical comment….</i> He then raises some econometric/statistical criticisms of our analysis. However, the main and most important part of the report does not contain any econometrics, as Prof. Stone admits (“<i>Econometric modelling was not invoked for the estimation of fiscal effects</i>”). His piece has therefore not much to say at all about the main part of our paper, which relates to the fiscal effects of immigration.<br />
<br />
The emphasis of his piece is rather on the estimation of probability models to determine whether immigrants from different groups are more or less likely than natives to receive state benefits/tax credits or live in social housing. Overall, all of these comments are quite minor and indeed “text-book” like, and we cannot detect any hint to a fundamental flaw in the way we have conducted our analysis. As with any analysis of data, the analyst has to make some assumptions, which is what we have done here as well, and which - as Prof. Stone admits – we “<i>set out with commendable clarity</i>”. None of the assumptions Prof. Stone mentions in his piece would in our view change the main conclusions that we draw from this part of our analysis, as we illustrate in our brief appendix below.<br />
<br />
The second piece [<a href="http://www.civitas.org.uk/pdf/RespondingtotheFiscalEffects.pdf" target="_blank">http://www.civitas.org.uk/pdf/RespondingtotheFiscalEffects.pdf</a>], by Nigel Williams, focuses in turn on the fiscal contribution analysis. His emphasis is on the government data we use and the assumptions needed for conducting analysis. Some of these comments are indeed well taken – and we are very clear in our report about the difficulties in conducting such analysis, based on the data that is available. In fact, we devote an entire section (section 2) to discussion of issues involved. However, overall, it is very unlikely that any other, equally reasonable, assumptions would change the general conclusions of our report. In fact, most of the points raised by Mr Williams will lead to a more positive, rather than more negative, conclusion on the net contribution of immigrants.<br />
<br />
For instance, Nigel Williams argues that the cost of interest on public sector debt should accrue only to natives, and not to immigrants, since it is natives who accumulated the debt. This means that – if anything - we are <i>over-estimating</i> the fiscal cost of immigration. Similarly, he argues that ”apportioning the cost of immigration and citizenship police services (as we do in our main scenario) entirely to immigrants is debatable.” We agree, but nevertheless we chose this option in our analysis because it provides a “worst case scenario” from the immigrants’ point of view. Assigning the cost of interest on public sector debt only to natives, as suggested by Mr Williams, would <i>decrease </i>the estimated fiscal cost of immigrants and correspondingly <i>increase </i>the fiscal cost of natives.<br />
<br />
Therefore, again, we appreciate the comments by this author and the interest he took in our study. Although we agree on a number of issues brought up, we also do not believe that any of the points raised would change our main conclusions.<br />
<br />
Thus, we were surprised by the mismatch between the content of the reports and the aggressively condescending tone of Civitas’ press release [<a href="http://www.civitas.org.uk/press/PRimmigration.html" target="_blank">http://www.civitas.org.uk/press/PRimmigration.html</a>]. <br />
<br />
In this context, we would like to raise two points.<br />
<br />
First, in the two reports there seems to be the suggestion that we should better not have done any analysis at all, as the data is not “perfect” and there is some remaining uncertainty in our findings. We totally disagree with this view. No analysis based on data will ever lead to results that are absolutely free of “uncertainty”, and no data is ever “perfect”. We have followed good academic practice and set out clearly the assumptions we have made in this piece, as has been acknowledged by Prof. Stone. We have (in earlier replies to comments [<a href="http://www.cream-migration.org/commentsarticle.php?blog=2" target="_blank">http://www.cream-migration.org/commentsarticle.php?blog=2</a>]) computed some extreme scenarios and we have shown that even that would not have changed our main conclusions. Thus, different assumptions may lead to slightly higher or slightly lower net contributions of immigrants, but they will not change the general conclusions of the study – namely that EEA immigrants who arrived after 1999 have made a substantial net fiscal contribution to the UK. We believe that – in a climate where anecdotal evidence rather than well researched data work dominate the public and policy debate – this is an important piece of information that the public ought to know.<br />
<br />
Second, both pieces mention the 2003 report on the likely inflow of immigrants from the A8 countries to the UK [<a href="http://www.ucl.ac.uk/~uctpb21/reports/HomeOffice25_03.pdf" target="_blank">http://www.ucl.ac.uk/~uctpb21/reports/HomeOffice25_03.pdf</a>] that Christian Dustmann co-authored. This report has nothing to do with our latest piece, but their criticism is eagerly taken up by Civitas director David Green to insult us and our reputation. Christian Dustmann and Ian Preston have responded to the ill-informed criticisms of that report in a separate piece [<a href="http://www.cream-migration.org/commentsarticle.php?blog=1" target="_blank">http://www.cream-migration.org/commentsarticle.php?blog=1</a>].<br />
<br />
In conclusion, we welcome constructive comments on our analysis. We are pleased that our report is so thoroughly publicly scrutinised, and we believe that this interchange will help improve the way we inform the public debate on this important and sensitive issue. However, we reject the offensive tones used by Civitas’ press release, and we believe that if accusing someone of "schoolboy errors", as done by Civitas’ director David Green, you ought to be able to point to more actual errors.<br />
<br />
<b>Appendix</b><br />
<i><u>Mervyn Stone, “Plain Assumptions and Unexplained Wizardy Called in Aid of “The Fiscal Effects of Immigration to the UK”</u></i><br />
<br />
The piece has two parts.<br />
<br />
In part one (“The Cream fiscal effect calculation”), Prof. Stone discusses our fiscal effect calculations. It remains unclear to us what the point of this section is – Stone’s report simply repeats our calculations and lists numbers in slightly different ways in his first two tables.<br />
<br />
Part two (“The econometrics that Cream calls on to estimate putative ‘probability gaps’) refers to Table 3 in our paper where we fit linear probability models to investigate the probability of welfare receipt of different immigrant populations, as compared to native born individuals. The main observations of Prof. Stone refer to two issues, the fit of our estimated model, and the model specification.<br />
<ol>
<li>The fit of the model, as measured by the coefficient of determination (R<sup>2</sup>). R<sup>2</sup> is a statistics that measures how much of the variation in the outcome variable that is explained by the independent variables is included in the model. It is a useful statistic if we would want to use our model for predictions. However, our analysis is aimed at estimating the difference in the probability of welfare receipt between two groups of individuals, immigrants and natives. In the simplest case (if we were interested in the unconditional difference, and the data was for one cross section only), this difference in probabilities would simply be the difference in the mean of the share of immigrants and the share of natives who receive welfare. No statistical measure of fit is needed to understand this difference, obviously. Further, this difference in the proportion of immigrants and natives’ welfare receipt would be estimated more precisely the more data points are available, as this adds information, and would thus reduce sampling error and increase statistical significance (see his point (iii) (a) on page 13). When we condition on observables, what matters is not R<sup>2</sup> per se, but how different characteristics may affect benefit take-up and whether these characteristics are correlated with immigrant status.</li>
<li>The specification of the model. (i) Choice of estimator: We estimate a simple linear probability model, which is easy to interpret. The method essentially fits cell probabilities (see above example), especially when all regressors are binary and mutually orthogonal (in which case probit models and LPM produce exactly the same cell probabilities). When we condition on observables, there may be some extrapolation because of functional form assumptions. However, re-estimating our specification using a probit estimator results in very similar conclusions (we are happy to provide the estimates). (ii) Specification: Our data covers many periods (quarters), and we are interested in a summary measure of the differences in welfare receipt between immigrants and natives. The specification we have chosen conditions on a set of time dummies (to allow for variation in welfare receipt over time that affects immigrants and natives alike), but does not allow for interactions between quarters and immigrant status in addition. As Prof Stone points out himself, our coefficient estimate is therefore interpretable as the weighted combination of the differences between welfare receipt between immigrants and natives across all quarters, which is precisely the coefficient we wish to estimate, as it has a meaningful and simple interpretation in this context. It is therefore a representation of the “weighted averaged” difference in welfare receipt between immigrants and natives over all quarters observed, conditioning on fluctuations in welfare receipt over time that affect immigrants and natives alike. We do agree however that the formulation “<i>… difference in the probability of receiving benefits or living in social housing between immigrants and natives observed at the same moment in time</i>” is imprecise, as Prof Stone points out – what we should have said is “<i>…the weighted averaged difference across quarters in the probability of receiving benefits or living in social housing between immigrants and natives, conditioning on fluctuations in welfare receipt over time that affect immigrants and natives alike</i>.” Thanks for pointing this out to us. (iii) Conditional models: To capture differences between immigrants and natives in demographic characteristics, we condition on gender and a quadratic in age. Again, this is a standard procedure. Of course, it implies an assumption about functional form – which we believe is not implausible but at the same time simple and transparent. One could relax functional form assumptions by including a full set of dummy variables for age, and interact them with gender dummies, or use matching type estimators. Using such estimators, results show an even larger difference in welfare and transfer receipt between immigrants and natives than reported in our Table 3. For instance the gap resulting from a fully interacted model specification is -0.125 for immigrants arriving since 2000, compared to the estimates of our more restricted specification reported in the Table, which gives an estimate of -0.084.</li>
<li>Robust standard errors: This is standard jargon in econometrics for the Huber and White estimator of the variance (see White, 1980 and MacKinnon and White, 1985), an estimator that corrects for the heteroscedasticity implied by the linear probability model. It is a textbook-like correction to make when calculating standard errors in this context (see e.g. Wooldridge (2001), page 454).</li>
</ol>
<br />
<b>References</b><br />
MacKinnon, J. G., and H. White (1985), “Some heteroskedasticity-consistent covariance matrix estimators with improved finite sample properties.” <i>Journal of Econometrics</i>, 29, 305–325.<br />
<br />
White, H. (1980), “A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct<br />
Test for Heteroskedasticity,” <i>Econometrica</i>, 48, 817–838.<br />
<br />
Wooldridge, J.M. (2001), “Econometric Analysis of Cross Section and Panel Data”, 1st edition, MIT Press.<br />
<br />Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-7277104189105966427.post-87642765592146716402014-01-16T08:00:00.000+00:002014-01-17T12:37:00.633+00:00How Early Estimates for Migration Flows after EU Enlargement in 2004 are Misinterpreted<b>by Christian Dustmann and Ian Preston</b><br />
<br />
Department of Economics and <a href="http://www.cream-migration.org/" target="_blank">Centre for Research of Analysis and Migration (CReAM)</a> at University College London<br />
<br />
<u>Introduction and Summary</u><br />
<br />
It has become part of recent conventional political wisdom that immigration to the UK from the eight countries acceding to the EU in May 2004 (A8 countries) was dramatically underestimated. Certain characterisations of the extent of this underestimation are very large. For example, then Conservative shadow minister, Lord Howell of Guildford, described predictions in 2005 as being "Laughably, ... out by about 2,200%” [<a href="http://www.publications.parliament.uk/pa/ld200506/ldhansrd/vo051220/text/51220-20.htm" target="_blank">http://www.publications.parliament.uk/pa/ld200506/ldhansrd/vo051220/text/51220-20.htm</a>] whereas then Liberal Democrat spokesman, Chris Huhne, claimed in 2008 that the "breathtaking" scale of the misprediction was 1,373% [<a href="http://www.publications.parliament.uk/pa/cm200708/cmhansrd/cm080424/debtext/80424-0016.htm" target="_blank">http://www.publications.parliament.uk/pa/cm200708/cmhansrd/cm080424/debtext/80424-0016.htm</a>]. More recently, Jack Straw, Foreign Secretary at the time of accession, has said that “The predictions were completely catastrophic. I mean they were wrong by a factor of 10,” and offered a number for annual net migration of “something like 130,000” [<a href="http://www.bbc.co.uk/programmes/b03phwk5" target="_blank">http://www.bbc.co.uk/programmes/b03phwk5</a>]. Outside of party politics, a recent report by Civitas [<a href="http://www.civitas.org.uk/press/PRimmigration.html" target="_blank">http://www.civitas.org.uk/press/PRimmigration.html</a>], for example, draws attention to the supposedly large deviation between forecast and outcome to cast doubt on other research.<br />
<br />
By contrast, one of the authors of this note has claimed that the figures were “not very far off” [<a href="http://www.bbc.co.uk/news/uk-politics-21682810" target="_blank">http://www.bbc.co.uk/news/uk-politics-21682810</a>]. The discrepancy between such a judgment and some of the comments above may seem difficult to understand but becomes more intelligible if attention is paid to what the predictions were for and the policy regime to which they were meant to apply. Poor understanding of the predictions and their policy context is unhelpful to a balanced debate on associated issues and this brief historical note is intended to clarify their basis.<br />
<br />
There are three types of error. The first two are elementary definitional errors:<br />
<ul>
<li>Some have confused annual figures with those which are cumulative over 9/10 years.</li>
<li>Some have confused <i><b>gross </b></i>numbers (i.e. those coming to the UK) with net numbers (i.e. the difference between those coming to the UK and those leaving the UK for elsewhere). </li>
</ul>
<br />
The third type of error is to ignore the difference between the context to which the predictions were supposed to apply and the reality of the context in which actual post-accession flows occurred. The Home Office commissioned a report with forecasts for the case in which other EU member states, and particularly Germany, would also, like the UK, permit labour migration from the A8 countries. In the event, all other EU member states except Ireland and Sweden put controls on labour migration in place. No forecasts were commissioned or calculated for such a case. Nonetheless the report recognises the importance of the issue and offers some speculative observations pointing out that migration to the UK would be substantially higher if other EU countries put controls in place.<br />
<br />
Below we explain in more detail the common misinterpretations of the projections which together explain the extent to which the under-prediction is frequently exaggerated.<br />
<br />
<u>The 2003 Report and Subsequent Migration</u><br />
<br />
The numbers usually quoted originate in a report [<a href="http://www.ucl.ac.uk/~uctpb21/reports/HomeOffice25_03.pdf" target="_blank">http://www.ucl.ac.uk/~uctpb21/reports/HomeOffice25_03.pdf</a>] written at the Centre for Research and Analysis of Migration (CReAM) [<a href="http://www.cream-migration.org/" target="_blank">http://www.cream-migration.org</a>]. The report contained predictions for net migration inflows from A8 accession countries to both the UK and Germany under a variety of scenarios. In particular, two scenarios presented for the UK gave predicted net inflows of 5,000 and 13,000 per year, averaged over a ten year period. The assumption underlying the central cases discussed was that other large countries in the EU (in particular Germany) would also open up their labour markets to A8 immigrants in May 2004. The report emphasised the weaknesses inherent in any attempt to predict immigration from A8 countries in the absence of historical migrations from these countries upon which predictions could be based. The forecasts were based on historic migration flows from other countries and the resulting numbers described as needing to be treated with “great caution” since the assumption of similarity between flows from these countries and A8 countries was highly unreliable.<br />
<br />
Estimates from the Office of National Statistics suggest that the actual net inflow over the nine years from 2004-2012 was 423,000 (Office of National Statistics: “Migration Statistics Quarterly Report”, November 2013). This corresponds to an actual outturn of about 50,000 per year. Comparison between the 2001 Census and 2011 suggests that the rate of arrival may have been substantially higher (although such a comparison also covers year prior to the 2004 enlargement) [<a href="http://www.ons.gov.uk/ons/guide-method/method-quality/specific/population-and-migration/population-statistics-research-unit--psru-/methods-used-to-revise-the-national-population-estimates-for-mid-2002-to-mid-2010.pdf" target="_blank">http://www.ons.gov.uk/ons/guide-method/method-quality/specific/population-and-migration/population-statistics-research-unit--psru-/methods-used-to-revise-the-national-population-estimates-for-mid-2002-to-mid-2010.pdf</a>].<br />
<br />
<u>Errors in Comparison</u><br />
<br />
The following are the most common errors in drawing comparisons involving these and other figures.<br />
<br />
Firstly, there are errors in interpreting what the forecasts were for. Some commentators seem not to distinguish between a predicted <i>annual rate of inflow </i>averaged over ten years and inflows for particular years or, worse, the <i>cumulated flow of immigrants over many years</i>. This can lead to particularly lurid comparisons.<br />
<br />
Secondly, another error is to fail to distinguish between net and gross migration flows. Gross migration is the total number of individuals entering the country. Net migration is the difference between the number entering and the number leaving. Return migration by earlier immigrants can mean that the numbers differ substantially. The numbers in the report referred to net migration flows. In the case of migration from A8 countries, gross migration between 2004 and 2011 has been estimated as 713,000 (Office of National Statistics: “Migration Statistics Quarterly Report”, November 2013), or about 80,000 individuals per year, a number higher by about two thirds than net migration. Again, failing to make this distinction tends to an exaggeration of the underprediction.<br />
<br />
Finally, a different sort of error is to fail to appreciate the difference between the policy context of the estimates in the report and that of the final outcomes. The report was prepared in early 2003 and its forecasts assume that labour markets of other European countries would also be open: as noted, migration flows to these other European countries were discussed in the report, and estimates for one of them, specifically Germany, also calculated. The report draws attention to possible sensitivity to adoption of transitional arrangements restricting access to labour markets in those other countries. The estimated average net yearly inflows to Germany (geographically and, arguably, culturally closer to the A8 countries than the UK) under various scenarios were between 20,000 and 210,000. In the event that Germany should impose a transitional arrangement closing its labour market, the report suggested that up to a third of these might come to the UK instead (and others to other closer countries) – although this was a speculative observation rather than an estimate, this is compatible with an additional flow diverted from Germany alone of anywhere between 7,000 and 70,000. In fact, not only did Germany impose the longest legally possible transitional restrictions but the UK was alone with Sweden and Ireland in allowing immediate access. Allowing for diverted migration flows not only from Germany but also from other countries which closed their labour markets, the range of possible inflows suggested in the report comes to encompass values of the order of magnitude that actually arose. Institutional arrangements under which A8 migrants have equal access to the labour markets of all EU partners have in fact held only since 2011.<br />
<br />
<u>Conclusion</u><br />
<br />
The frequent suggestion that the forecasts were misleading by orders of magnitude is not supported by close reading of the report, which is explicit on<br />
<br />
<ul>
<li>providing numbers on average annual net inflows covering a period of ten years, rather than cumulated (gross) inflows of immigrants over several years</li>
<li>providing numbers applicable to a policy regime in which other large EU countries open their labour markets alongside the UK – a regime that did not materialise </li>
</ul>
<br />
The range of tentative suggestions the report provides on possible annual net migration inflows if Germany – the largest potential immigration country for A8 immigrants – should not allow for free movement of labour includes numbers comparable with the actual annual net immigration from A8 countries based on ONS figures for the period 2004 to 2012.<br />
<br />
<u>References:</u><br />
<br />
Dustmann, C., Casanova, M., Fertig, M., Preston, I. and Schmidt, C.M. (2003) The impact of EU enlargement on migration flows. (Home Office Online Report 25/03 ).<br />
<br />
Office of National Statistics: “Migration Statistics Quarterly Report”, November 2013<br />
<div>
<br /></div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-41692282030959394222013-11-26T09:35:00.000+00:002014-01-17T12:37:10.661+00:00Further Response to Comments on “The Fiscal Impact of Immigration on the UK”<b><span style="font-family: Arial, Helvetica, sans-serif;">by Christian Dustmann and Tommaso Frattini</span></b><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="background-color: white; color: #222222; line-height: 18px;"><span style="font-family: Arial, Helvetica, sans-serif;"><a href="http://www.cream-migration.org/" target="_blank">Centre for Research and Analysis of Migration (CReAM)</a> at University College London</span></span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">Our paper “The Fiscal Impact of Immigration on the UK” [<a href="http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf" target="_blank">http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf</a>] has continued to be the object of lively debate. We intend here to address certain criticisms and explore further issues. In particular, among the points that have been raised, there has been criticism of the way we deal with the allocation of corporate tax revenues and of business rates. We have responded to these criticisms before [<a href="http://creamcomments.blogspot.co.uk/2013/11/nothing-is-hidden-in-our-report-on.html" target="_blank">http://creamcomments.blogspot.co.uk/2013/11/nothing-is-hidden-in-our-report-on.html</a>]. </span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">In a recent piece [<a href="http://strongerinnumbers.com/komposersitelocal/CReAMresponse1.pdf" target="_blank">http://strongerinnumbers.com/komposersitelocal/CReAMresponse1.pdf</a>], Michael O’Connor argues again that our way of allocating corporate tax revenues between UK natives and different immigrant groups would over-estimate the likely payments of recent immigrants for two reasons:</span><br />
<ol>
<li><span style="font-family: Arial, Helvetica, sans-serif;">“As it treats even a recent immigrant as having the same investment in UK companies as soon as they arrive as a lifelong resident does”.</span></li>
<li><span style="font-family: Arial, Helvetica, sans-serif;">As “the same fiscal contribution will be attributed to any partner accompanying the migrating worker and also to any child they might have”, so that the “fiscal contribution [of immigrants] through corporate taxes will be deemed to increase with every new migrant and new child born”.</span></li>
</ol>
<span style="font-family: Arial, Helvetica, sans-serif;">We welcome all suggestions for improving our estimates, and indeed we acknowledge that point 1 deserves consideration. However, point 2 incorrectly overstates his case, as we allocate revenues of corporation taxes (and of capital gains tax) – after taking out the share which is paid by overseas shareholders – on a per capita basis among the </span><i style="font-family: Arial, Helvetica, sans-serif;">adult </i><span style="font-family: Arial, Helvetica, sans-serif;">(18+) population only (we explain this in Table A2 [</span><a href="http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf" style="font-family: Arial, Helvetica, sans-serif;" target="_blank">http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf</a><span style="font-family: Arial, Helvetica, sans-serif;">]). Therefore it is not the case that the estimated amount of corporation taxes paid by immigrants is “deemed to increase with every new child born”.</span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">As regards point 1, we believe that in the absence of better approximations, a per capita allocation among the adult population is a reasonable criterion. However, we could also take the comment to its extreme consequence, and assume that immigrants arrived since 2000 do not contribute <u>at all</u> to corporate and capital gains tax revenues in any year. This is obviously an extreme assumption, and one which will considerably under-estimate the tax payments of immigrants. Nevertheless, it will clearly establish a lowest bound estimate for the tax contributions immigrants make. We show what effect this would have below.</span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">In a previous comment [<a href="http://strongerinnumbers.com/cream3.html" target="_blank">http://strongerinnumbers.com/cream3.html</a>], Michael O’Connor also suggests that our imputation of business rates revenues based on share of self-employment might misleadingly over-estimate the tax payments of recent immigrants. We have already responded to that criticism, which we think is unfounded [<a href="http://creamcomments.blogspot.co.uk/2013/11/nothing-is-hidden-in-our-report-on.html" target="_blank">http://creamcomments.blogspot.co.uk/2013/11/nothing-is-hidden-in-our-report-on.html</a>]. Here we should reiterate that allocating business rates according to self-employment shares – as we do – does not mean that we are assuming that only the self-employed pay them. It just means that we believe a reasonable proxy for the distribution of business rates revenues might be the self-employment density among immigrants and natives. </span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">The allocation of corporate taxation and business rates raises complicated questions of incidence. The fact that businesses write the cheques does not mean that the burdens do not fall ultimately on people. Whether those people are customers, shareholders, property owners or whoever, depends upon how economic decisions and, as a consequence, prices respond to taxation and is not a straightforward question. </span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">However, again, an extreme scenario would be one where immigrants who have arrived since 2000 do not pay any business rates.</span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">We have re-estimated our models to obtain the net fiscal contribution of immigrants and natives for these extreme scenarios. Remember that corporate and capital gains tax amount to more than 9% of total government revenues, and business rates to more than 4% of total government revenues (see Table A2 in our paper [<a href="http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf" target="_blank">http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf</a>]), so we are assuming that more than 13% of total revenues are only attributable to natives and immigrants who were in the UK before 2000.</span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">The next table compares our original results with the results that we obtain under these extreme assumptions.</span><br />
<table border="0" cellpadding="0" cellspacing="0" class="MsoNormalTable" style="border-collapse: collapse; margin-left: 2.75pt; mso-padding-alt: 0cm 3.5pt 0cm 3.5pt; mso-yfti-tbllook: 1184; width: 604px;">
<tbody>
<tr style="height: 25.5pt; mso-yfti-firstrow: yes; mso-yfti-irow: 0;">
<td colspan="9" style="height: 25.5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 453.35pt;" width="604"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<b><i><span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">Years
2001-2011</span></i></b><b><i><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></b></div>
</td>
</tr>
<tr style="height: 30.0pt; mso-yfti-irow: 1;">
<td colspan="9" style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 453.35pt;" width="604"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<b><i><span lang="EN-US" style="font-family: Calibri, sans-serif; font-size: 11pt;">Original calculations in our
paper</span></i></b><b><i><span lang="EN-US" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></b></div>
</td>
</tr>
<tr style="height: 30.0pt; mso-yfti-irow: 2;">
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 52.0pt;" width="69"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<b><i><span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">Natives</span></i></b><b><i><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></b></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" width="64"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<br /></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<b><i><span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">EEA</span></i></b><b><i><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></b></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 61.35pt;" width="82"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<br /></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<b><i><span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">Non
EEA</span></i></b><b><i><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></b></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" width="64"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<br /></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<b><i><span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">Recent
EEA</span></i></b><b><i><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></b></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" width="64"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<br /></div>
</td>
<td style="border-bottom: solid windowtext 1.0pt; border: none; height: 30.0pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<b><i><span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">Recent
Non EEA</span></i></b><b><i><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></b></div>
</td>
</tr>
<tr style="height: 26.25pt; mso-yfti-irow: 3;">
<td colspan="9" nowrap="" style="height: 26.25pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 453.35pt;" width="604"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<i><span lang="EN-US" style="font-family: Calibri, sans-serif; font-size: 11pt;"> Overall net
fiscal contributions (million, 2011 GBP equivalent), 2001-2011</span></i><i><span lang="EN-US" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></div>
</td>
</tr>
<tr style="height: 15.0pt; mso-yfti-irow: 4;">
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 52.0pt;" valign="bottom" width="69"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">-624,120</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">8,978</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 61.35pt;" valign="bottom" width="82"></td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">-86,820</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">22,106</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">2,942</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
</tr>
<tr style="height: 23.25pt; mso-yfti-irow: 5;">
<td colspan="9" nowrap="" style="height: 23.25pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 453.35pt;" width="604"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<i><span lang="EN-US" style="font-family: Calibri, sans-serif; font-size: 11pt;"> Ratio of real
revenues to real expenditures, 2001-2011 </span></i><i><span lang="EN-US" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></div>
</td>
</tr>
<tr style="height: 15.75pt; mso-yfti-irow: 6;">
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 52.0pt;" valign="bottom" width="69"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">0.894</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">1.045</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 61.35pt;" valign="bottom" width="82"></td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">0.851</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">1.339</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">1.019</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
</tr>
<tr style="height: 23.25pt; mso-yfti-irow: 7;">
<td colspan="9" nowrap="" style="border: none; height: 23.25pt; mso-border-top-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 453.35pt;" valign="bottom" width="604"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<b><i><span lang="EN-US" style="font-family: Calibri, sans-serif; font-size: 11pt;">Assuming no
corporation tax, capital gains tax, or business rates paid by recent
immigrants</span></i></b><b><i><span lang="EN-US" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></b></div>
</td>
</tr>
<tr style="height: 26.25pt; mso-yfti-irow: 8;">
<td colspan="9" nowrap="" style="height: 26.25pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 453.35pt;" width="604"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<i><span lang="EN-US" style="font-family: Calibri, sans-serif; font-size: 11pt;"> Overall net
fiscal contributions (million, 2011 GBP equivalent) , 2001-2011</span></i><i><span lang="EN-US" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></div>
</td>
</tr>
<tr style="height: 15.0pt; mso-yfti-irow: 9;">
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 52.0pt;" valign="bottom" width="69"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">-601,175</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">2,199</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 61.35pt;" valign="bottom" width="82"></td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">-96,772</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">13,422</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="height: 15.0pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">-9,921</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
</tr>
<tr style="height: 23.25pt; mso-yfti-irow: 10;">
<td colspan="9" nowrap="" style="height: 23.25pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 453.35pt;" width="604"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<i><span lang="EN-US" style="font-family: Calibri, sans-serif; font-size: 11pt;"> Ratio of real
revenues to real expenditures, 2001-2011</span></i><i><span lang="EN-US" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></i></div>
</td>
</tr>
<tr style="height: 15.75pt; mso-yfti-irow: 11; mso-yfti-lastrow: yes;">
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 52.0pt;" valign="bottom" width="69"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">0.898</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">1.011</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 61.35pt;" valign="bottom" width="82"></td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">0.834</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">1.206</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 48.0pt;" valign="bottom" width="64"></td>
<td nowrap="" style="border-bottom: solid windowtext 1.0pt; border: none; height: 15.75pt; mso-border-bottom-alt: solid windowtext .5pt; padding: 0cm 3.5pt 0cm 3.5pt; width: 49.0pt;" valign="bottom" width="65"><div align="center" class="MsoNormal" style="margin-bottom: 0.0001pt; text-align: center;">
<span lang="IT" style="font-family: Calibri, sans-serif; font-size: 11pt;">0.937</span><span lang="IT" style="font-family: Calibri, sans-serif;"><o:p></o:p></span></div>
</td>
</tr>
</tbody></table>
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">As the entries in the table clearly show, even under this scenario, recent EEA immigrants still make a substantial positive net fiscal contribution over the period 2001-2011. The numbers in the Table show that they would have paid 21% more in taxes than they received in transfers and benefits. Moreover, even though the net fiscal contribution of recent non-EEA immigrants is now negative (although less negative than that of natives, despite the fact that we allocate the revenues from corporate and capital gains tax and business rates to natives), the overall contributions of all immigrants who arrived since 2000 still remains positive.</span><sup style="font-family: Arial, Helvetica, sans-serif;">1</sup><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">More generally, and as we have already mentioned in our first response, we believe we have taken an approach that tends to understate overall immigrants’ fiscal contributions, for different reasons. In our calculations we always consider second generation immigrant children (i.e. the UK-born children of foreign-born parents) until age 15 as immigrants, but (due to a lack of information in the LFS that allows us to identify individuals born to immigrants once they have left the parental household) we consider them as natives when they are adults (we explain that and discuss the consequences of this assumption in section 2.1.1 in our paper). In this way, we understate immigrant contributions from a dynamic angle. One can see this from two perspectives. Looking at it one way, we consider the cost of educating the children of immigrants, but we do not correspondingly consider the savings the UK makes by not bearing the cost of educating adult and highly educated migrants. Alternatively, looking at it in another way, we consider the cost of educating UK-born children of immigrants as a cost of immigration, but when these children grow up, work and pay taxes we allocate their revenues to the native population.</span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;">An alternative approach, that would perhaps get closer to capturing the dynamic fiscal effects of immigration, would be to not consider the costs of educating the UK-born children of immigrants. If we do so, the estimated net fiscal contributions of immigrants obviously increase, especially for those groups who have more children. In this case, and maintaining the extreme assumption of no corporate and capital gains tax and no business rates paid by recent immigrants, the ratio of revenues to expenditures would be 1.23 for recent EEA immigrants and 0.98 for recent non-EEA immigrants (while still 0.9 for natives). </span><br />
<span style="font-family: Arial, Helvetica, sans-serif;"><br /></span>
<span style="font-family: Arial, Helvetica, sans-serif;"><u> </u><br /><sup>1</sup> There was also a slight misunderstanding of our Table 1 in Michael O’Connor’s piece. To reconstruct the size of the total population from our Table 1, one should just sum over columns 1-2-3, and not over all columns, as columns 4 and 5 are just subsamples of columns 2 and 3, respectively. </span>Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-7277104189105966427.post-77963925583705064362013-11-07T09:22:00.000+00:002014-01-17T12:37:21.688+00:00Nothing is ‘hidden’ in our report on the fiscal effects of recent UK immigration<!--[if gte mso 9]><xml>
<o:OfficeDocumentSettings>
<o:AllowPNG/>
</o:OfficeDocumentSettings>
</xml><![endif]--><span style="font-family: Arial,Helvetica,sans-serif;">
</span><br />
<div class="MsoNormal">
<span style="font-family: Arial,Helvetica,sans-serif;"><span style="mso-ansi-language: EN-GB;">by <b>Christian Dustmann,
Tommaso Frattini</b> </span></span></div>
<span style="font-family: Arial,Helvetica,sans-serif;">
</span><br />
<div class="MsoNormal">
<span style="font-family: Arial,Helvetica,sans-serif;"><span style="mso-ansi-language: EN-GB;"><a href="http://www.cream-migration.org/" target="_blank">Centre for Researchand Analysis of Migration (CReAM)</a> at University College London</span></span></div>
<div class="MsoNormal">
<br /></div>
<div class="MsoNormal">
<span style="font-family: Arial,Helvetica,sans-serif;"><span style="mso-ansi-language: EN-GB;"><!--[if gte mso 9]><xml>
<o:OfficeDocumentSettings>
<o:AllowPNG/>
</o:OfficeDocumentSettings>
</xml><![endif]--></span></span></div>
<div class="MsoNormal">
<span style="font-family: Arial,Helvetica,sans-serif;"><span style="mso-ansi-language: EN-GB;"><!--[if gte mso 9]><xml>
<w:WordDocument>
<w:View>Normal</w:View>
<w:Zoom>0</w:Zoom>
<w:TrackMoves/>
<w:TrackFormatting/>
<w:PunctuationKerning/>
<w:ValidateAgainstSchemas/>
<w:SaveIfXMLInvalid>false</w:SaveIfXMLInvalid>
<w:IgnoreMixedContent>false</w:IgnoreMixedContent>
<w:AlwaysShowPlaceholderText>false</w:AlwaysShowPlaceholderText>
<w:DoNotPromoteQF/>
<w:LidThemeOther>EN-GB</w:LidThemeOther>
<w:LidThemeAsian>X-NONE</w:LidThemeAsian>
<w:LidThemeComplexScript>X-NONE</w:LidThemeComplexScript>
<w:Compatibility>
<w:BreakWrappedTables/>
<w:SnapToGridInCell/>
<w:WrapTextWithPunct/>
<w:UseAsianBreakRules/>
<w:DontGrowAutofit/>
<w:SplitPgBreakAndParaMark/>
<w:EnableOpenTypeKerning/>
<w:DontFlipMirrorIndents/>
<w:OverrideTableStyleHps/>
</w:Compatibility>
<m:mathPr>
<m:mathFont m:val="Cambria Math"/>
<m:brkBin m:val="before"/>
<m:brkBinSub m:val="--"/>
<m:smallFrac m:val="off"/>
<m:dispDef/>
<m:lMargin m:val="0"/>
<m:rMargin m:val="0"/>
<m:defJc m:val="centerGroup"/>
<m:wrapIndent m:val="1440"/>
<m:intLim m:val="subSup"/>
<m:naryLim m:val="undOvr"/>
</m:mathPr></w:WordDocument>
</xml><![endif]--><!--[if gte mso 9]><xml>
<w:LatentStyles DefLockedState="false" DefUnhideWhenUsed="true"
DefSemiHidden="true" DefQFormat="false" DefPriority="99"
LatentStyleCount="267">
<w:LsdException Locked="false" Priority="0" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Normal"/>
<w:LsdException Locked="false" Priority="9" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="heading 1"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 2"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 3"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 4"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 5"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 6"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 7"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 8"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 9"/>
<w:LsdException Locked="false" Priority="39" Name="toc 1"/>
<w:LsdException Locked="false" Priority="39" Name="toc 2"/>
<w:LsdException Locked="false" Priority="39" Name="toc 3"/>
<w:LsdException Locked="false" Priority="39" Name="toc 4"/>
<w:LsdException Locked="false" Priority="39" Name="toc 5"/>
<w:LsdException Locked="false" Priority="39" Name="toc 6"/>
<w:LsdException Locked="false" Priority="39" Name="toc 7"/>
<w:LsdException Locked="false" Priority="39" Name="toc 8"/>
<w:LsdException Locked="false" Priority="39" Name="toc 9"/>
<w:LsdException Locked="false" Priority="35" QFormat="true" Name="caption"/>
<w:LsdException Locked="false" Priority="10" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Title"/>
<w:LsdException Locked="false" Priority="1" Name="Default Paragraph Font"/>
<w:LsdException Locked="false" Priority="11" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Subtitle"/>
<w:LsdException Locked="false" Priority="22" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Strong"/>
<w:LsdException Locked="false" Priority="20" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Emphasis"/>
<w:LsdException Locked="false" Priority="59" SemiHidden="false"
UnhideWhenUsed="false" Name="Table Grid"/>
<w:LsdException Locked="false" UnhideWhenUsed="false" Name="Placeholder Text"/>
<w:LsdException Locked="false" Priority="1" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="No Spacing"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 1"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 1"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 1"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 1"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 1"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 1"/>
<w:LsdException Locked="false" UnhideWhenUsed="false" Name="Revision"/>
<w:LsdException Locked="false" Priority="34" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="List Paragraph"/>
<w:LsdException Locked="false" Priority="29" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Quote"/>
<w:LsdException Locked="false" Priority="30" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Intense Quote"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 1"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 1"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 1"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 1"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 1"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 1"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 1"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 1"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 2"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 2"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 2"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 2"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 2"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 2"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 2"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 2"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 2"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 2"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 2"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 2"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 2"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 2"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 3"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 3"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 3"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 3"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 3"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 3"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 3"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 3"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 3"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 3"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 3"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 3"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 3"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 3"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 4"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 4"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 4"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 4"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 4"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 4"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 4"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 4"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 4"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 4"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 4"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 4"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 4"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 4"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 5"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 5"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 5"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 5"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 5"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 5"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 5"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 5"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 5"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 5"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 5"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 5"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 5"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 5"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 6"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 6"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 6"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 6"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 6"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 6"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 6"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 6"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 6"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 6"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 6"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 6"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 6"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 6"/>
<w:LsdException Locked="false" Priority="19" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Subtle Emphasis"/>
<w:LsdException Locked="false" Priority="21" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Intense Emphasis"/>
<w:LsdException Locked="false" Priority="31" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Subtle Reference"/>
<w:LsdException Locked="false" Priority="32" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Intense Reference"/>
<w:LsdException Locked="false" Priority="33" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Book Title"/>
<w:LsdException Locked="false" Priority="37" Name="Bibliography"/>
<w:LsdException Locked="false" Priority="39" QFormat="true" Name="TOC Heading"/>
</w:LatentStyles>
</xml><![endif]--><!--[if gte mso 10]>
<style>
/* Style Definitions */
table.MsoNormalTable
{mso-style-name:"Table Normal";
mso-tstyle-rowband-size:0;
mso-tstyle-colband-size:0;
mso-style-noshow:yes;
mso-style-priority:99;
mso-style-parent:"";
mso-padding-alt:0cm 5.4pt 0cm 5.4pt;
mso-para-margin:0cm;
mso-para-margin-bottom:.0001pt;
mso-pagination:widow-orphan;
font-size:10.0pt;
font-family:"Times New Roman","serif";}
</style>
<![endif]-->
</span></span></div>
<div class="MsoNormal" style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">Two pieces on the Telegraph blog criticise our recent report on the
fiscal impact of immigration to the UK [<a href="http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf" target="_blank">http://www.cream-migration.org/publ_uploads/CDP_22_13.pdf].</a></span></div>
<div class="MsoNormal" style="line-height: 150%;">
<br />
<span style="mso-ansi-language: EN-GB;">The first by Tim Wigmore [</span><span lang="IT"><a href="http://blogs.telegraph.co.uk/news/timwigmore/100244413/the-immigration-debate-everyone-ignores-the-inconvenient-facts/" target="_blank"><span lang="EN-GB" style="mso-ansi-language: EN-GB;">http://blogs.telegraph.co.uk/news/timwigmore/100244413/the-immigration-debate-everyone-ignores-the-inconvenient-facts/</span></a></span><span class="MsoHyperlink"><span style="mso-ansi-language: EN-GB;"> </span></span><span style="mso-ansi-language: EN-GB;">] suggests <span style="display: none; mso-hide: all;">HhEH</span>that the press release summarising our report only
highlights the positive effect of <i style="mso-bidi-font-style: normal;">recent</i>
immigration to the public purse, while ‘hiding’ the fiscal cost represented by
earlier non-European immigrants. He says that it is not ‘OK for a report to
whitewash out inconvenient facts’.</span></div>
<div class="MsoNormal" style="line-height: 150%;">
<br /></div>
<div class="MsoNormal" style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">In the report, we compute the fiscal net contribution for two immigrant
populations: first, all those who arrived after 1999; and second, all those
immigrants who lived in the UK between 1995 and 2011, whenever they arrived. In
both cases, we distinguish between immigrants from the European Economic Area
(EEA) and non-EEA immigrants. The press release focuses on the first population
because recent debate has been about the fiscal impact of immigrants who
arrived over the last decade, many of them from Eastern Europe [<a href="http://www.cream-migration.org/files/Press_release_fiscal_costs_benefits.pdf" target="_blank">http://www.cream-migration.org/files/Press_release_fiscal_costs_benefits.pdf]</a>. But the paper also reports results for all immigrants
who reside in the UK in each year between 1995 and 2011.</span></div>
<div class="MsoNormal" style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">As to Mr
Wigmore’s criticism, we first note that if we had wanted to ‘hide’ numbers
relating to all immigrants who resided in the UK between 1995 and 2011, we
would not have put them in the report in the first place. We could easily have
written a report that dealt exclusively with recent immigrants. And these
numbers are not ‘hidden away’ in the report – in fact, they are not only shown
in the Table 5 Mr Wigmore refers to, but also, and broken down by years, in
Table 4a and in Figures 1a and 1b, which features on the BBC website [<a href="http://www.bbc.co.uk/news/uk-24813467" target="_blank">http://www.bbc.co.uk/news/uk-24813467</a></span><span class="MsoHyperlink"><span style="mso-ansi-language: EN-GB;"></span></span><span style="mso-ansi-language: EN-GB;">] for everybody to see.</span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">As for the
findings for the non-EEA immigrants who resided in the UK between 1995 and
2011, the fact that their average contribution is negative just means that they
are similar to the native British-born. This is as much a reflection of the
fact that the exercise is being conducted for a period of overall budget
deficit, when the average contribution must be negative, as it is of anything
distinctive about their fiscal contribution. The fact on which we focused is
the noteworthy one that a particular group of immigrants (EEA-immigrants) are
net contributors even when there is an overall deficit.</span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">Further, the
deficit that we attribute to older non-EEA immigrants is likely to be
significantly overstated because we are taking a very cautious approach. This
group has large numbers of UK-born second generation children and the cost of
educating them is counted as a cost associated with the ‘Immigrant’ group even
though, for data reasons, we cannot include grown children’s tax payments as
benefits to set against that. Thus, this contributes to understating immigrant
contributions. </span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">The piece by Douglas
Carswell MP [<a href="http://blogs.telegraph.co.uk/news/douglascarswellmp/100244371/why-the-experts-are-wrong-about-immigration/" target="_blank">http://blogs.telegraph.co.uk/news/douglascarswellmp/100244371/why-the-experts-are-wrong-about-immigration/</a></span><span lang="EN-US" style="mso-ansi-language: EN-GB;"></span><span style="mso-ansi-language: EN-GB;">] raises a number of methodological points relating to our study and
suggests that some points are intentionally not made clear. He then challenges
some of our conclusions.</span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">We first note
that – precisely because we very clearly lay out how every single number is
constructed, as is good academic practice – Mr Carswell is actually able to try
to ‘deconstruct what the experts say’. Precisely because we do not want people
to believe experts' opinions as if they were true by definition, we have
clearly detailed how we have apportioned each item of government receipt and
expenditure.</span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">Our study
uses the best data available to reach conclusions on the fiscal impact of
recent immigration. But even those data are not perfect, and as in every such
analysis, some assumptions have to be made when using them to compute the
fiscal net contribution of population groups. </span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">As to the
first point Mr Carswell raises, that we are misallocating business rates as we
allocate their revenue based on self-employment shares: this method is
well-established in the research literature predating our work; it is not an unreasonable
criterion to use; and any other criterion would be more arbitrary. In any case,
business rates account for about 4% of total revenues, so changes in the
apportioning coefficient will certainly not ‘massively distort the balance
sheet’ as Mr Carswell claims. </span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">As regards Mr
Carswell’s other points: the allocation of company and capital taxes accounts
for the fact that a substantial fraction of UK companies is owned by
non-resident shareholders. After removing their estimated payments, we allocate
the remaining revenues on a per capita basis to the resident population. We clearly
explain the assumption that we are making in choosing our apportioning
criterion. Again, we do not believe other assumptions are more justified or
better grounded.</span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">We use data
from the UK Labour Force Survey (LFS) in our study. This is a large
representative survey of the UK population, which provides the most
comprehensive data available and over a long period of time. The DWP data to
which Mr Carswell refers are not as complete (they start in 2002), and using
them to study the welfare take-up of immigrants requires a number of
(potentially questionable) assumptions, as the author of that report correctly points
out, since immigrant status is not recorded. Moreover, the report to which Mr
Carswell refers [<a href="http://www.strongerinnumbers.com/komposersitelocal/NonUKreportfinal.pdf" target="_blank">http://www.strongerinnumbers.com/komposersitelocal/NonUKreportfinal.pdf</a></span><span class="MsoHyperlink"><span style="mso-ansi-language: EN-GB;"></span></span><span style="mso-ansi-language: EN-GB;">] does not distinguish between different groups
of immigrants, as we do. </span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">Further, Mr Carswell’s
claim (in point 4) that we mix together all benefits in our analysis of the
fiscal contribution is simply untrue. In fact, we know from the LFS who is
receiving what type of benefit, and we use that information to allocate the
cost of each benefit (as we detail in Table A1). </span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">Finally, on
Mr Carswell’s point 5, although it may be true that different immigrant groups
have different claiming patterns, this is not at all a concern for our analysis,
as we are looking at broad groups of individuals, and we effectively consider average
behaviour across national groups, within the groups we define (EEA and non-EEA).
Thus, even if we would distinguish between immigrants from Poland, Estonia,
etc. when assigning benefit receipts, by aggregating them up to larger groups,
this distinction would be averaged away. Therefore, Mr Carswell’s claim that
this aspect of our methodology ‘undermine(s) the claim that European Economic
Area migrants contribute 34 percent more in taxes than they receive in
benefits’ is simply incorrect.</span></div>
<div style="line-height: 150%;">
<br /></div>
<div style="line-height: 150%;">
<span style="mso-ansi-language: EN-GB;">Although both
of these pieces base their critiques on the suggestion that there are things
hidden in the report, the ease with which each has <span style="color: black;">identified
the facts which have interested them</span> shows that our report is on the
contrary unusually open about how its figures are arrived at. And contrary to
the impression that might be given by these two pieces, we have at all points
leaned towards conclusions that understate immigrants’ contributions. We
disagree with some of the interpretations on which these critiques are based,
but welcome any fair-minded discussion of the reasonableness of the procedures
we adopt.</span></div>
<span style="font-family: Arial,Helvetica,sans-serif;">
</span><br />
<div class="MsoNormal">
<br /></div>
<span style="font-family: Arial,Helvetica,sans-serif;">
</span><br />
<div class="MsoNormal">
<span style="font-family: Arial,Helvetica,sans-serif;"><span style="mso-ansi-language: EN-GB;"></span></span></div>
<span style="font-family: Arial,Helvetica,sans-serif;">
</span><span style="font-family: Arial,Helvetica,sans-serif;">
</span><br />
<div class="MsoNormal">
<span style="font-family: Arial,Helvetica,sans-serif;"><span style="mso-ansi-language: EN-GB;"></span></span></div>
<span style="font-family: Arial,Helvetica,sans-serif;"></span><span style="font-family: Arial,Helvetica,sans-serif;"><span lang="IT"></span></span><span style="font-family: Arial,Helvetica,sans-serif;"></span><!--[if gte mso 9]><xml>
<w:WordDocument>
<w:View>Normal</w:View>
<w:Zoom>0</w:Zoom>
<w:TrackMoves/>
<w:TrackFormatting/>
<w:PunctuationKerning/>
<w:ValidateAgainstSchemas/>
<w:SaveIfXMLInvalid>false</w:SaveIfXMLInvalid>
<w:IgnoreMixedContent>false</w:IgnoreMixedContent>
<w:AlwaysShowPlaceholderText>false</w:AlwaysShowPlaceholderText>
<w:DoNotPromoteQF/>
<w:LidThemeOther>EN-GB</w:LidThemeOther>
<w:LidThemeAsian>X-NONE</w:LidThemeAsian>
<w:LidThemeComplexScript>X-NONE</w:LidThemeComplexScript>
<w:Compatibility>
<w:BreakWrappedTables/>
<w:SnapToGridInCell/>
<w:WrapTextWithPunct/>
<w:UseAsianBreakRules/>
<w:DontGrowAutofit/>
<w:SplitPgBreakAndParaMark/>
<w:EnableOpenTypeKerning/>
<w:DontFlipMirrorIndents/>
<w:OverrideTableStyleHps/>
</w:Compatibility>
<m:mathPr>
<m:mathFont m:val="Cambria Math"/>
<m:brkBin m:val="before"/>
<m:brkBinSub m:val="--"/>
<m:smallFrac m:val="off"/>
<m:dispDef/>
<m:lMargin m:val="0"/>
<m:rMargin m:val="0"/>
<m:defJc m:val="centerGroup"/>
<m:wrapIndent m:val="1440"/>
<m:intLim m:val="subSup"/>
<m:naryLim m:val="undOvr"/>
</m:mathPr></w:WordDocument>
</xml><![endif]--><!--[if gte mso 9]><xml>
<w:LatentStyles DefLockedState="false" DefUnhideWhenUsed="true"
DefSemiHidden="true" DefQFormat="false" DefPriority="99"
LatentStyleCount="267">
<w:LsdException Locked="false" Priority="0" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Normal"/>
<w:LsdException Locked="false" Priority="9" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="heading 1"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 2"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 3"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 4"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 5"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 6"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 7"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 8"/>
<w:LsdException Locked="false" Priority="9" QFormat="true" Name="heading 9"/>
<w:LsdException Locked="false" Priority="39" Name="toc 1"/>
<w:LsdException Locked="false" Priority="39" Name="toc 2"/>
<w:LsdException Locked="false" Priority="39" Name="toc 3"/>
<w:LsdException Locked="false" Priority="39" Name="toc 4"/>
<w:LsdException Locked="false" Priority="39" Name="toc 5"/>
<w:LsdException Locked="false" Priority="39" Name="toc 6"/>
<w:LsdException Locked="false" Priority="39" Name="toc 7"/>
<w:LsdException Locked="false" Priority="39" Name="toc 8"/>
<w:LsdException Locked="false" Priority="39" Name="toc 9"/>
<w:LsdException Locked="false" Priority="35" QFormat="true" Name="caption"/>
<w:LsdException Locked="false" Priority="10" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Title"/>
<w:LsdException Locked="false" Priority="1" Name="Default Paragraph Font"/>
<w:LsdException Locked="false" Priority="11" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Subtitle"/>
<w:LsdException Locked="false" Priority="22" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Strong"/>
<w:LsdException Locked="false" Priority="20" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Emphasis"/>
<w:LsdException Locked="false" Priority="59" SemiHidden="false"
UnhideWhenUsed="false" Name="Table Grid"/>
<w:LsdException Locked="false" UnhideWhenUsed="false" Name="Placeholder Text"/>
<w:LsdException Locked="false" Priority="1" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="No Spacing"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 1"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 1"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 1"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 1"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 1"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 1"/>
<w:LsdException Locked="false" UnhideWhenUsed="false" Name="Revision"/>
<w:LsdException Locked="false" Priority="34" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="List Paragraph"/>
<w:LsdException Locked="false" Priority="29" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Quote"/>
<w:LsdException Locked="false" Priority="30" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Intense Quote"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 1"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 1"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 1"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 1"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 1"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 1"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 1"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 1"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 2"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 2"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 2"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 2"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 2"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 2"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 2"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 2"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 2"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 2"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 2"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 2"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 2"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 2"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 3"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 3"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 3"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 3"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 3"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 3"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 3"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 3"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 3"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 3"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 3"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 3"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 3"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 3"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 4"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 4"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 4"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 4"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 4"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 4"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 4"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 4"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 4"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 4"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 4"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 4"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 4"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 4"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 5"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 5"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 5"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 5"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 5"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 5"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 5"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 5"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 5"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 5"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 5"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 5"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 5"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 5"/>
<w:LsdException Locked="false" Priority="60" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Shading Accent 6"/>
<w:LsdException Locked="false" Priority="61" SemiHidden="false"
UnhideWhenUsed="false" Name="Light List Accent 6"/>
<w:LsdException Locked="false" Priority="62" SemiHidden="false"
UnhideWhenUsed="false" Name="Light Grid Accent 6"/>
<w:LsdException Locked="false" Priority="63" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 1 Accent 6"/>
<w:LsdException Locked="false" Priority="64" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Shading 2 Accent 6"/>
<w:LsdException Locked="false" Priority="65" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 1 Accent 6"/>
<w:LsdException Locked="false" Priority="66" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium List 2 Accent 6"/>
<w:LsdException Locked="false" Priority="67" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 1 Accent 6"/>
<w:LsdException Locked="false" Priority="68" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 2 Accent 6"/>
<w:LsdException Locked="false" Priority="69" SemiHidden="false"
UnhideWhenUsed="false" Name="Medium Grid 3 Accent 6"/>
<w:LsdException Locked="false" Priority="70" SemiHidden="false"
UnhideWhenUsed="false" Name="Dark List Accent 6"/>
<w:LsdException Locked="false" Priority="71" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Shading Accent 6"/>
<w:LsdException Locked="false" Priority="72" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful List Accent 6"/>
<w:LsdException Locked="false" Priority="73" SemiHidden="false"
UnhideWhenUsed="false" Name="Colorful Grid Accent 6"/>
<w:LsdException Locked="false" Priority="19" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Subtle Emphasis"/>
<w:LsdException Locked="false" Priority="21" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Intense Emphasis"/>
<w:LsdException Locked="false" Priority="31" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Subtle Reference"/>
<w:LsdException Locked="false" Priority="32" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Intense Reference"/>
<w:LsdException Locked="false" Priority="33" SemiHidden="false"
UnhideWhenUsed="false" QFormat="true" Name="Book Title"/>
<w:LsdException Locked="false" Priority="37" Name="Bibliography"/>
<w:LsdException Locked="false" Priority="39" QFormat="true" Name="TOC Heading"/>
</w:LatentStyles>
</xml><![endif]--><!--[if gte mso 10]>
<style>
/* Style Definitions */
table.MsoNormalTable
{mso-style-name:"Table Normal";
mso-tstyle-rowband-size:0;
mso-tstyle-colband-size:0;
mso-style-noshow:yes;
mso-style-priority:99;
mso-style-parent:"";
mso-padding-alt:0cm 5.4pt 0cm 5.4pt;
mso-para-margin:0cm;
mso-para-margin-bottom:.0001pt;
mso-pagination:widow-orphan;
font-size:10.0pt;
font-family:"Times New Roman","serif";}
</style>
<![endif]-->Unknownnoreply@blogger.com3tag:blogger.com,1999:blog-7277104189105966427.post-63737961255737374662012-02-10T15:44:00.000+00:002014-01-17T12:40:00.772+00:00Attitudes to Immigration<div class="MsoPlainText">
<span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">by <b>Ian Preston</b></span></span></div>
<div class="MsoPlainText">
<span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;"><a href="http://www.cream-migration.org/" target="_blank">Centre for Research and Analysis of Migration</a>, Dept of Economics, University College London</span></span></div>
<div class="MsoPlainText">
<br /></div>
<div class="MsoPlainText">
<ol>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">The economic effects of immigration to the
UK - both its <a href="http://creamcomments.blogspot.com/2012/01/16th-january-2012-some-thoughts-on.html" target="_blank">impact on the labour market</a> and <a href="http://creamcomments.blogspot.com/2012/01/original-date-of-posting-22nd-january.html" target="_blank">on public finances</a> - have attracted considerable attention in the past
month as a consequence of the release of a number of reports and official
statistics. The evidence that
immigration is harmful to the UK-born is weak and indeed there are stronger
empirical grounds for thinking immigration is on the whole economically
beneficial, although it would be difficult to pick this fact up from much press
coverage. If there are any undesirable
effects then they are probably largely <a href="http://www.ucl.ac.uk/~uctpb21/Cpapers/CDP_03_08.pdf" target="_blank">distributional effects</a> of a sort which could be addressed by combining a relaxed
immigration policy with other interventions.</span></span><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;"><br /> </span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">Nonetheless immigration is unpopular and
this raises questions as to whether economics is at the root of this
opposition. Of course, fears about
economic effects can exist even if they are unfounded but there are also other
impacts which may generate hostility to immigration. These social and cultural issues are delicate
topics for discussion since they touch on discomforting questions of racial and
ethnic prejudice. Undoubtedly,
unpleasant xenophobic motivations underlie some disquiet at the social effects
of immigration but it is also true that not all such concern is so
motivated. Cultural change brought about
by immigration can be seen as enriching but also as not. Loss of linguistic,
religious or cultural homogeneity can be seen as regrettably undermining social
solidarity and as aggravating social tensions.
Opinions differ on these issues and these differences are associated
with differing views on immigration policy.</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">These issues are cross-national. Countries across Europe differ greatly in
their openness to immigration and also in the prevalence of related attitudes
but the questions are universal.</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">The European Social Survey is a very large
cross-national data source. We at CReAM
were lucky enough to be involved in <a href="http://www.ucl.ac.uk/~uctpb21/Cpapers/CDP_03_05.pdf" target="_blank">the design of a module</a> dealing with immigration in the first round of the
survey in 2002, some of the questions from which have been retained in later
rounds. This gave an opportunity to collect information on opinion about a wide
range of effects and about the desirability of openness to immigration from
different parts of the world.</span></span><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;"><br />(The design team was admirably headed by <a href="http://www.natcen.ac.uk/media-centre/news-articles/2012/roger-jowell" target="_blank">Roger Jowell</a> whose recent death is a source of sadness to anyone interested
in serious study of opinion formation).</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">The data contains answers to questions on
economic effects of immigration (jobs; wages; inequality; skill shortages) and
sociocultural effects (linguistic, religious and cultural homogeneity; cultural
change; social tensions; crime) and questions on preferred openness of
immigration policy towards arrivals from richer and poorer countries inside and
outside Europe. There are also some
rather broad questions on whether immigration is good or bad for the receiving
country's economy and way of life; reassuringly, answers to economic questions
do seem to be associated especially strongly with the former and answers to
socio-cultural questions with the latter.
But which type of question is most strongly associated with opinion on
what sort of immigration policy is most desirable?</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">Here at CReAM, disentangling the motives underlying
individual attitudes to immigration has been part of the research agenda for
more than a decade (see <a href="http://www.ucl.ac.uk/~uctpb21/doc/viewcontent.pdf" target="_blank">here</a>
or <a href="http://www.ucl.ac.uk/~uctpb21/doc/CDP_06_04.pdf" target="_blank">here</a>,
for example). The <a href="http://www.cream-migration.org/publ_uploads/CDP_29_09.pdf" target="_blank">latest paper</a>, published this month in the <a href="http://onlinelibrary.wiley.com/doi/10.1111/jeea.2012.10.issue-1/issuetoc" target="_blank">Journal of the European Economic Association</a>, addresses this question using
data on the 22 European countries participating in the ESS.</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">The central finding is that both economic
and social concerns are associated with hostility to immigration but the association
with the latter is much stronger. This
is not to say that economic issues are unconnected with opposition to
immigration but they appear to be connected much less strongly than other
issues. This finding is robust to
different ways of treating the data.</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">This pattern is reasonably consistent
across Europe. The strength of concerns
differs across countries as does the willingness to accept immigration but the
ways in which they are related to each other is much more homogeneous.</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">It is important to emphasise that
correlation is not causation. The fact
that those hostile to immigration are also concerned about its effects on
employment, say, does not mean the latter opinion caused the former. It is tempting to think of individuals as rationally
considering the effects of immigration before weighing up their views on such
matters to determine an opinion regarding immigration policy; it is quite
possible however that attitudes towards immigrants held on other grounds
encourage receptivity to views on effects that validate these opinions. It is very plausible for instance to think
someone concerned about preserving social homogeneity might be driven by that
to oppose immigration and this opposition could bleed into a preparedness to
accept the validity of secondary economic concerns. Concerns about economic and social effects
are themselves highly correlated suggesting some common source.</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">There are other reasons to be welcoming
or not to immigration. A government
minister <a href="http://www.homeoffice.gov.uk/media-centre/speeches/making-immigration-work" target="_blank">has argued</a> that the "key insight" of the recent MAC report
"is that the measure of a successful immigration policy is how it
increases the wealth of the resident population". This is not really a finding so much as the
expression of a moral point of view and not one universally shared. Some people would think the gains or losses
to immigrants and to their home countries also matter. Others would hold it to be unjust that rights
of free movement internationally should depend on place of birth and others
that richer countries have responsibilities, perhaps associated with inglorious
colonial histories, towards residents of poorer countries. Questions in the survey also tested these
dimensions of opinion and analysis of the data suggests that such concerns are
also correlated with preferences on immigration policy.</span></span></li>
<li><span style="font-family: Arial; font-size: x-small;"><span style="font-family: "Arial","sans-serif"; font-size: 10pt;">It is and has been recognised for some
time that attitudes towards immigration vary in systematic ways with the
socioeconomic and demographic characteristics of the opinion holder. One common finding is that the less educated
are more hostile to immigration and this fact has often been put forward as
evidence for the primacy of economic concerns in driving such attitudes, given
that such individuals are often thought to be more vulnerable to labour market
competition from immigrants. Education,
however, is also strongly associated with a more generally liberal attitude to
social questions, possibly because education either exposes individuals to
broader perspectives on life or because it is more attractive to those who
already have such views. Analysis of
the ESS data suggests that a much greater fraction of the difference in
attitudes across education groups is accountable for by difference in social
concerns than economic ones. Older
individuals also tend to be less liberal on immigration and this is more
difficult to see as evidence for the primacy of economics since the elderly
presumably suffer little labour market competition. Again analysis suggests it is difference in
social attitudes that are more strongly associated.</span></span></li>
</ol>
</div>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-43023144340439308752012-01-22T16:01:00.000+00:002014-01-17T12:39:36.396+00:00Migrant Benefit Study<b></b><br />
by <b>Christian Dustmann</b>, Professor of Economics at University College London and Director, <a href="http://www.cream-migration.org/">Centre for</a><a href="http://www.cream-migration.org/" target="_blank"> Research and Analysis of Migration</a>,<br />
and <b>Tommaso Frattini</b>, Assistant Professor of Economics at University of Milan and Research Fellow, <a href="http://www.cream-migration.org/" target="_blank">Centre for Research and Analysis of Migration</a>.<br />
<ol>
<li>
On Friday January 20<sup>th</sup> <i>The Telegraph</i> published an article by Chris Grayling (Minister for Employment) and Damian Green (Immigration Minister) entitled "Labour didn’t care who landed in Britain - The last government had lax immigration and a chaotic way of controlling foreign benefit claimants."<br />
</li>
<li>
That piece seems to suggest that foreign born nationals are more likely to claim benefits, and are possibly not entitled to do so, without providing any information that would be needed for appropriate assessment. A key line in that article states that "<i>As a result we now know that there are 371,000 people who were foreign nationals when they entered Britain who are claiming benefits.</i>"<br />
</li>
<li>
That number is actually very good news: immigrants are far less likely to claim benefits than natives. Of course, this cannot be deduced from the piece in the Telegraph, as we are not told what is the number of foreign born individuals who live today in the UK, neither are we told what is the total number of benefit claimants. Inspection of the British Labour Force Survey (BLFS) shows that around 5.6 million individuals living in the UK in 2010 (in the age range 16-65, which is the age range within which individuals are most likely to be in the workforce, and to claim such benefits) are born in another country, with the overall population in the UK in that age range being almost 40 million. Thus, immigrants constitute 14 percent of the total working age population. <a class="orange" href="http://research.dwp.gov.uk/asd/index.php?page=statistical_summaries" target="_blank">According to DWP</a>, there are 5.7 million benefit claimants as of May 2011. Thus, the share of the 371,000 individuals who were foreign nationals when they entered Britain among benefit claimants is only 6.5 percent. Therefore, assuming that those who entered as foreign nationals are also foreign born, it follows that they are less than half as likely to claim benefits as native born individuals.<br />
</li>
<li>
If we really want to assess whether immigration imposes a burden for the UK public finances, we need to consider both immigrants’ benefits receipts and the tax payments immigrants make. That of course requires a far more involved analysis. Our previous research on the fiscal consequences of immigration from the eight Central and Eastern European countries that joined the European Union in May 2004 (so called A8 countries) has done just that (Dustmann, Frattini and Halls 2010). It investigates the effect immigration from these countries had on the welfare system, by computing benefit receipts of immigrants who came to the UK between 2004 and the first quarter of 2009, using information from the BLFS and data from several government departments on the budget and on tax- and benefit payments, and covering the fiscal years 2004/05 to 2008/09.<br />
</li>
<li>
The research shows that A8 immigrants over that period were less likely to be claiming welfare benefits or to be living in social housing than individuals born in the UK. Further, they made a positive contribution to the UK fiscal system, paying more in taxes than they receive in direct and indirect public transfers (such as benefits, NHS healthcare and education). For example, in 2008/09, A8 immigrants represented 0.91% of the total UK population, but contributed 0.96% of total tax receipts and accounted for only 0.6% of total expenditures. In particular:<br />
<ul>
<li>
The study also shows that A8 immigrants who arrived after EU enlargement in 2004, and who have at least one year of residence – and are therefore legally eligible to claim benefits – are over 50% less likely than natives to receive state benefits or tax credits, and to live in social housing. Comparing the net fiscal contribution of A8 immigrants with that of individuals born in the UK, in each fiscal year since enlargement in 2004, A8 immigrants made a positive contribution to public finances.<br />
</li>
<li>
In every year since 2004, A8 immigrants made a positive and substantial net contribution to public finances. For instance, in the fiscal year 2008/09, A8 immigrants paid 37% more in direct or indirect taxes than was spent on public goods and services which they received. This was even more remarkable because the UK was running a budget deficit over those years, meaning that overall, individuals living in the UK made a negative net contribution to public finances.<br />
</li>
<li>
The study also demonstrates that on average, A8 immigrants have a better educational background than UK-born workers, but receive lower wages - especially in the period immediately after arriving in the UK. Despite this, A8 immigrants are net contributors to the public finances. The main reason for this is that they have a higher rate of labour force participation (increasing the number of fiscal contributors), and make less use of benefits and public services.<br />
</li>
</ul>
</li>
<li>
We have subsequently extended our research to the entire UK immigrant population. First findings show that for those cohorts who arrived after 1995, the ratio of their share of total tax payments to their share in the total population is always larger than the share of public expenditure they receive, relative to their share in the total population Thus, all these immigrant cohorts contributed more than the native born to public finances.<br />
</li>
<li>
As researchers in the field of immigration, we are acutely aware of the limitations in data about the foreign population in the UK, and we welcome any effort to enhance the current knowledge base. The government’s effort to link information on immigrant status to administrative data on benefits receipt is therefore a very welcome addition. However, it is equally important that any research conducted is carefully and clearly documented, and that any research results are presented in an appropriate manner that avoids misrepresentation in the media. This is particularly important in an area as sensitive as immigration. Research on migration, in particular when publicised by government sources, needs to be appropriately reported and benchmarked if it is to be of any use in enhancing our knowledge of such an important and complex phenomenon.<br />
</li>
</ol>
<b>References</b><br />
"Labour didn’t care who landed in Britain" by Chris Grayling and Damian Green: <a href="http://www.telegraph.co.uk/news/uknews/immigration/9025260/Labour-didnt-care-who-landed-in-Britain.html" target="_blank">http://www.telegraph.co.uk/news/uknews/immigration/9025260/Labour-didnt-care-who-landed-in-Britain.html</a><br />
Dustmann, C., Frattini, T. and C. Halls (2010), "Assessing the Fiscal Costs and Benefits of A8 Migration to the UK", Fiscal Studies, vol. 31, no. 1, pp. 1–41. See also CREAM DP 18/09 <a href="http://www.cream-migration.org/publ_uploads/CDP_18_09.pdf" target="_blank">http://www.cream-migration.org/publ_uploads/CDP_18_09.pdf</a><br />
<b>Other comments: </b><br />
Jonathan Portes commented on his blog: <a href="http://notthetreasuryview.blogspot.com/2012/01/migrants-benefits-and-public-services.html" target="_blank">http://notthetreasuryview.blogspot.com/2012/01/migrants-benefits-and-public-services.html</a><br />
The BBC reported: <a class="orange" href="http://www.bbc.co.uk/news/uk-16643677" target="_blank">http://www.bbc.co.uk/news/uk-16643677</a>; <a href="http://www.bbc.co.uk/news/uk-16659847" target="_blank">http://www.bbc.co.uk/news/uk-16659847</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-7277104189105966427.post-22445844001838460912012-01-16T10:00:00.000+00:002014-01-17T12:38:40.883+00:00Some thoughts on immigration and unemployment<b></b><br />
by <b>Ian Preston</b><br />
<i><a href="http://www.cream-migration.org/" target="_blank">Centre for Research and Analysis of Migration</a>, Dept of Economics, University College London</i><br />
<ol>
<li>
Two reports published on the same day last week contain evidence on the impact of recent immigration on employment of the UK-born. One of these (NIESR 2012) claims to find no evidence of an effect; the other (MAC 2012) suggests that certain sorts of immigrants in certain periods may have depressed employment. The difference in conclusions makes it difficult to identify exactly what economic evidence really shows. This note offers some comments on what can be learnt from these two reports.<br />
<br />
The reports usefully complement each other. The methods are broadly similar. Both compare changes in employment rates and levels of immigration across spatially defined local labour markets, correcting as well as possible for other effects. However they use different data sources over different periods and at different levels of spatial aggregation so it is not surprising that results differ and it is informative to compare the ways in which they do.<br />
<blockquote>
One report (MAC 2012) uses a large labour survey that has been running for many years and the authors are therefore able to assess things over a longer period. However because the survey covers fewer workers they need to aggregate up to larger spatial units. The measure of immigration, based on change in numbers of foreign-born workers, keeps track of immigrants leaving as well as entering regions.</blockquote>
<blockquote>
The other report (NIESR 2012) uses recent administrative data of much wider coverage and these authors are therefore able to focus on smaller spatial units but only over a shorter period. The measure of immigration, based on NI registrations, is focused on employment-related immigration but has the weakness that it tracks only immigrant arrivals. Since flows of immigrants between regions and out of the country are not small relative to inflows this seems a significant countervailing drawback.</blockquote>
</li>
<li>
Some media coverage has taken the line that it is only common sense to think immigration must lower employment prospects for those already in the country and all that has happened is that one study has finally uncovered what should have been obvious all the time. Of course, if it were so obvious then it would hardly have been necessary for so much research effort to have been expended on the question. But it is not obvious.<br />
<br />
When, say, an immigrant secures a vacancy for which a UK-born applicant was considered, it is often visible and understandably motivates grievance, even though it may not be obvious that the UK-born applicant would have been offered the job otherwise (and even though leaving the vacancy unfilled might have had consequences for employment of others). When spending by the employed immigrant adds to local demand, that, by contrast, is far less visible but no less important. Mere movement of workers from one country to another does not in itself change the amount of demand for goods in the world. The demand for internationally tradable goods produced in the UK can come from anywhere in the world and is not obviously tied to how many people are in any particular country and as migrants move into the country they bring demand for nontraded goods and services with them. It is perfectly reasonable – indeed arguably common-sense – to start from an expectation that immigration should bring just enough demand into the country to enable immigrants to be employed without any adverse effect on the UK-born.<br />
<br />
This expectation is only a starting point - a more sophisticated view will recognise the potential for immigration to affect prices and wages in ways that may feed back onto employment in one way or another. Processes of equilibration take time and there may be short term employment effects even if these disappear in the long run. In the absence of any clear presumption about which way the final effect should go, the matter calls out for empirical research. We should not be surprised if that research fails ultimately to find evidence of any substantial impact.<br />
</li>
<li>
There have been studies in several countries and the preponderance of evidence is strongly suggestive that employment effects are small if they exist at all. Some of that research, cited in both reports, was done by researchers including myself at CReAM (CReAM 2005); that work failed to find convincing evidence for employment effects in the UK but that, as with much work in the area, was arguably as much because of the difficulty of making estimates precise as it was because they were clearly small. Other people have found similarly scant evidence. In this context, new research such as these two reports is a welcome addition.<br />
</li>
<li>
The MAC paper looks for effects from immigration of several different sorts in several different periods. Many of these estimated effects are unexciting; typically at most one type of immigration in one subperiod is found to be individually statistically significant. Focussing on individual statistical significance can be misleading when there is no reason to think that the particular type of immigration concerned has drawn attention for any reason other than its having the strongest attached statistic. A better question to ask would arguably have been whether or not one can statistically reject the hypothesis that all effects are jointly zero. It is not at all clear that such a test would support the conclusion that immigration harms employment.<br />
</li>
<li>
The main results in the NIESR paper are based upon much smaller spatial units. This gives more data points, enhancing statistical precision, but also makes it less easy to be confident that the boundaries of these spatial units reliably contain the labour market effects studied. At this level of spatial aggregation, no evidence of employment effects is found.<br />
<br />
The paper also, however, reports results estimated at regional level, the same as in the MAC report. The NIESR authors do not concentrate on these, because they prefer the results at the lower level of spatial aggregation on methodological grounds, but the result do make a striking contrast to those in the MAC report since they both appear statistically not badly determined and actually point to immigration being associated with lower unemployment and being so more strongly in periods of downturn. This contrast diametrically with the MAC conclusions and does not encourage confidence in the robustness of conclusions that can be reached with regional level data.<br />
</li>
<li>
The MAC report itself is extremely open about the fragility of results to several robustness checks such as removal of outliers. This lack of solidity does not necessarily mean that they are not picking up real effects but does call for caution before using conclusions as a guide to policy-making. Furthermore, insofar as there may be employment effects of immigration, some of these robustness checks hint they may be short term and therefore compatible with being transitional rather than part of an effect on long run equilibrium in the economy.<br />
</li>
<li>
Recent work on the closely related question of how immigration affects wages in the UK (CReAM 2012) shows that weak effects on the average can be compatible with different effects along the distribution of skills. The NIESR report points to investigation of the possibility of differential effects on employment prospects of high and low skilled UK born workers as a priority for future work. This seems a sensible judgement.<br />
</li>
<li>
The body of the MAC report is typically careful not to claim causality, preferring to refer to "associations" (even though talk of "displacement" is suggestive of a causal impact). What has been found is that a particular subclass of immigration has tended in part of the data to be higher in regions and periods with rising unemployment than in other regions. This doesn’t mean that it caused the change in employment. Predictably, much media coverage has been less reticent.<br />
<br />
It is impossible to interpret these associations without thinking about the processes driving immigration. Immigrant location is not random. There is a lot of evidence that immigrants tend to go to areas where immigrants of similar types already live. This is easily understandable as there may be family connections and associated employment networks in established communities of similar origin. This effect is likely to be weaker among recent EU immigrants who come from populations with less history of immigration to the country.<br />
<br />
Immigration is at the same time responsive to economics and this is what raises problems with causal interpretations. Employment booms may draw immigration into an area and this will tend to mask any negative employment effect. Temporarily high wages may also draw in immigration and if that inhibits hiring then this will tend to inflate the appearance of negative employment effects. The problems which this raises are conceptually very difficult to overcome. One response is to see whether similar association is also there between employment changes and that part of immigration flows which can be predicted from plausibly noneconomic drivers, like prior concentrations of immigrants in an area. Both NIESR and MAC check this. While the NIESR conclusions are reportedly robust, the precision of the negative employment effects estimated by MAC tends to deteriorate sharply.<br />
</li>
<li>
Viewing the totality of new evidence, it is difficult to see a persuasively robust empirical case for long run harmful effects of immigration on employment of the UK-born.<br />
</li>
</ol>
References<br />
NIESR 2012: “<a class="orange" href="http://www.niesr.ac.uk/pubs/searchdetail.php?PublicationID=3125" target="_blank">Examining the relationship between immigration and unemployment using National Insurance Number registration data</a>”, Paolo Lucchino, Chiara Rosazza-Bondibene and Jonathan Portes, National Institute of Economic and Social Research, 2012<br />
MAC 2012: "<a class="orange" href="http://cream-migration.org/files/MAC_report_jan2012.pdf">Analysis of the Impacts of Migration"</a>, Migration Advisory Committee, 2012<br />
CReAM 2005: “<a class="orange" href="http://onlinelibrary.wiley.com/doi/10.1111/j.1468-0297.2005.01038.x/full" target="_blank">The impact of immigration on the UK labour market</a>”, Christian Dustmann, Francesca Fabbri and Ian Preston, Economic Journal, 115, pp F342-F358, 2005<br />
CReAM 2012: "<a class="orange" href="http://www.google.co.uk/url?sa=t&rct=j&q=the%20effect%20of%20immigration%20along%20the%20distribution%20of%20wages&source=web&cd=3&ved=0CEYQFjAC&url=http%3A%2F%2Fwww.ucl.ac.uk%2F%7Euctpb21%2FCpapers%2FCDP_03_08.pdf&ei=QFQUT8fQGMO-8APEn4ztBA&usg=AFQjCNEpqIC5IGe1CDkR9Qm8fx35gvqspw&cad=rja">The effect of immigration along the distribution of wages</a>", Christian Dustmann, Tommaso Frattini and Ian Preston, Review of Economic Studies, forthcoming, 2012Unknownnoreply@blogger.com0