Redistributive Policies and Migrants’ Labor Market Choices

Abstract

Migration in its various forms, such as economic migration, is a central issue in contemporary research and politics. Our paper provides insights into the behavior of societies faced with the possibility of migratory inflow into their respective social security and welfare systems. In particular, we study economic migrants' willingness to take up work and integrate into society, and, in turn, destination country citizens' willingness to allow economic migrants to pursue formal work and integrate into society and its social security and welfare systems. Using a laboratory experiment, we find clear evidence for a reciprocal relationship between the experimental participants in these roles. Greater labor market participation of economic migrants promotes greater openness of destination country citizens to welcoming migrants. Conversely, greater destination country citizen willingness to accommodate migrant labor market participation promotes greater willingness to take up work among migrants. We conclude that supporting economic migrants in early labor market attachment is crucial to support mutually beneficial co-existence in a society.

Keywords: migration, redistributive policies, discrimination, labor market

JEL Classification: I38, J61, O15, C91, C72