مهاجرت، باروری و سرمایه انسانی: مدل رکود اقتصادی در غرب

I show how the influences of unskilled immigration, differential fertility between immigrants and the local indigenous population, and incentives for investment in human capital combine to predict the decline of the West. In particular, indigenous low-skilled workers lose from unskilled immigration even if the indigenous low-skilled workers do not finance redistribution, do not compete with immigrants in the labor market, and do not compete with immigrants for publicly financed income transfers. For the economy at large, high-fertility unskilled immigrants and a low-fertility indigenous population result in economic decline through reduced human capital accumulation and reduced growth of per-capita output.

In European countries the total fertility rate among indigenous populations has long been far below the replacement level of 2.1 children per woman. In recent times the average total fertility rate in Europe has been 1.4 children per woman. At the same time, the reproduction rate among immigrant populations and their European-born descendants has been higher and above the replacement level. The demographic trends if continued herald the decline of the indigenous European populations to levels from which recovery is near impossible. The trends are also associated with decline in supply of high-income high-skilled labor, which forms a principal tax base for public finance. Against the background of these issues, I consider the political economy of relations between immigrants and indigenous or local population, in particular the less educated segments of local populations. Both economic reasons and non-economic considerations such as cultural differences (for example relating to treatment of women) have also been noted as reasons for opposition to immigration. See Hillman, 1994, Hillman and Weiss, 1999a, Bauer et al., 2000, Hansen, 2003, Dustmann and Preston, 2001, Dustmann and Preston, 2006, Dustmann and Preston, 2007, Scheve and Slaughter, 2001, Gang et al., 2002, O'Rourke and Sinnott, 2006 and Miguet, 2008, among others. In this paper, I focus only on the economic aspects of immigration. Much immigration is illegal. I do not consider illegal immigration in this paper but focus on legal migration and the political economy of immigration policy and its long-run consequences.1 The principal economic reason for opposition of low-skilled indigenous workers to immigration is usually portrayed as competition in the labor market that reduces the low-skilled wage. However, immigrants often do not integrate into the work force but rather remain unproductive and so do not reduce the low-skilled wage. I do not consider the reasons why parts of immigrant population remain unproductive: Nannestad (2009) reviews possible reasons. I show how, when immigrants do not compete in the local labor market, low-skilled workers who do not pay taxes to finance income transfers to immigrants nonetheless lose from the presence of immigrants through the relationship between fertility and human capital investment. I link immigration-induced redistribution to reductions in fertility of the indigenous population, high fertility of the immigrants, and low attractiveness of human capital investment. With high-fertility unskilled immigrants and a low-fertility indigenous population, income transfers to immigrants raise fertility of the immigrants while decreasing fertility of the indigenous skilled population that finances the income transfers. Human capital accumulation and the growth of per-capita income decline. Immigration-induced income redistribution, although financed by taxes on the skilled workers, disadvantages the local unskilled workers through the disincentive for investment in human capital. Indigenous unskilled workers lose from the presence of immigrants, although they do not finance redistribution and do not compete with immigrants for publicly financed income transfers. Due to the differential fertility and skills, economic decline takes place among the entire population. As a consequence, without reference to the non-economic considerations, income redistribution to immigrants is the reason for opposition to immigration, especially among indigenous low-skilled workers. To demonstrate these relationships and conclusions, I use a growth model with endogenous fertility as developed in Dahan and Tsiddon, 1998 and Azarnert, 2004. I describe an economy populated by two indigenous groups, one consisting of low-income unskilled workers and the other of high-income skilled workers. An unskilled minority group comprised of immigrants and their descendants is also present. The latter receive tax-financed income transfers because of insufficient own-earned income. The local unskilled workers, who earn lower wages than the skilled workers, are exempt from taxation. However, if they invest in human capital, they join the skilled and begin paying taxes. This directly reduces their potential after-tax incomes and discourages them from acquiring human capital. With children a normal good, income redistribution raises fertility of the unskilled minority beneficiaries and lowers fertility among the taxpaying local skilled population. When growth of skilled population declines, so does the total stock of human capital. Output growth declines, as does the rate of increase in the return to human capital via a human capital externality. The decline in the rate of increase of the pre-tax gross income of the skilled is a disincentive for the indigenous unskilled population to investment in human capital. The transition of the indigenous unskilled population to being skilled is thereby delayed.

I have used a growth model with endogenous fertility to show how income redistribution increases the fertility of the immigrants and lowers fertility in the indigenous skilled population that finances the income transfers, with the result that human capital accumulation and the growth of per-capita output decline. Low-skilled immigration is the impetus for the decline in the incomes and numbers of the indigenous population. The conclusions are obtained under conditions in which immigrants do not compete in the local labor market with indigenous low-skilled workers. The indigenous low-skilled workers also do not pay taxes to finance income transfers to immigrants. Nonetheless indigenous low-skilled workers lose from the presence of immigrants. I have shown how the source of the loss for indigenous low-skilled workers is traced to the relationship between fertility and human capital investment. There are two sources of the disadvantageous consequences for indigenous unskilled people. Taxation of income of the skilled population directly decreases their potential after-tax income in the skilled sector. Taxation also reduces the rate of increase in the return to efficiency labor, thereby distorting the mechanism that eventually would make the acquisition of human capital worthwhile for the offspring of indigenous unskilled parents, which deters the investment in human capital that would transform indigenous low-income people to make them part of the skilled high-income population. More generally, I have presented a model that is based on empirical foundations and predicts if trends continue the decline of the west, in particular in Europe, because of the longer-run consequences of unskilled dependent immigration.