Abstract

http://ssrn.com/abstract=290859
 
 

References (23)



 
 

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The Dynamics of Immigrant Welfare and Labor Market Behavior


Jorgen Hansen


Concordia University, Quebec - Department of Economics; Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA)

Magnus Lofstrom


Public Policy Institute of California; Institute for the Study of Labor (IZA)

October 2001

CEPR Discussion Paper No. 3028

Abstract:     
This Paper analyzes transitions into and out of three different labor market states: social assistance, unemployment and employment. We estimate a dynamic multinomial logit model, controlling for endogenous initial conditions and unobserved heterogeneity, using a large representative Swedish panel data set, LINDA, for the years 1990-6. The unadjusted data indicates that immigrants are more likely to receive both social assistance and unemployment compensation than natives are. Immigrants are less likely to remain employed in consecutive years than natives are and are more likely to stay on welfare and to receive unemployment insurance in any year, given participation in the previous year. The empirical results suggest that refugee immigrants display a greater degree of "structural" state dependence than natives. Further, immigrants from non-refugee countries display a similar degree of "structural" state dependence as natives. The high welfare participation rates among refugee immigrants seem to be due to the existence of a "welfare trap," while participation among natives and non-refugee immigrants is largely due to permanent unobserved characteristics. These results suggest that welfare reforms will have differential effects on refugee immigrants and natives.

Number of Pages in PDF File: 42

Keywords: Immigration, labor market behavior, state dependence, transition, welfare

JEL Classification: I30, I38, J15, J18, J61

working papers series





Date posted: November 13, 2001  

Suggested Citation

Hansen, Jorgen and Lofstrom, Magnus, The Dynamics of Immigrant Welfare and Labor Market Behavior (October 2001). CEPR Discussion Paper No. 3028. Available at SSRN: http://ssrn.com/abstract=290859

Contact Information

Jorgen Hansen (Contact Author)
Concordia University, Quebec - Department of Economics ( email )
1455 de Maisonneuve Blvd. W.
Montreal, Quebec H3G 1MB
Canada
514-848-3924 (Phone)
514-848-4536 (Fax)
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Institute for the Study of Labor (IZA)
P.O. Box 7240
Bonn, D-53072
Germany
Magnus Lofstrom
Public Policy Institute of California ( email )
500 Washington Street
Suite 800
San Francisco, CA 94111
United States
Institute for the Study of Labor (IZA) ( email )
P.O. Box 7240
Bonn, D-53072
Germany
+49 228 3894 303 (Phone)
+49 228 3894 210 (Fax)
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