High Skilled Immigration Policy and Union Wage Setting

This paper studies the effects of high skilled immigration on employment and net income in the host economy where the market for low skilled labor is distorted by union wage setting and a redistributive unemployment benefit scheme. I show that high skilled immigration can increase as well as decreas...

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Bibliographic Details
Published in:MAGKS - Joint Discussion Paper Series in Economics (Band 21-2011)
Main Author: Bonn, Moritz
Format: Work
Language:English
Published: 2012
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Online Access:PDF Full Text
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Summary:This paper studies the effects of high skilled immigration on employment and net income in the host economy where the market for low skilled labor is distorted by union wage setting and a redistributive unemployment benefit scheme. I show that high skilled immigration can increase as well as decrease low skilled employment depending on how the public budget adjusts to immigration and that the effects on workers' net income levels may vary substantially. I conclude that a Pareto improvement can be achieved if the unemployment benefit level remains unaffected by high skilled immigration.
Physical Description:20 Pages
ISSN:1867-3678
DOI:10.17192/es2024.0087