Smoke but no fire – the GFC and European immigration

What effect did the GFC have in Europe on immigration policy? Tim Hatton (abstract):

Historical experience suggests that when a period of rising immigration is followed by a sudden slump, this can trigger a policy backlash. This has not occurred in the current recession. This paper examines three links in the chain between the slump and immigration policy. First, although immigration flows have responded to the slump, and immigrants have borne more than their share of the burden, this has done little to protect the employment of non-immigrants.

Second, despite the recession for Europe as a whole, attitudes to immigration have not changed very much, and they have been influenced more by fiscal concerns than by rising unemployment. Third, while far right parties have used the recession to renew the political pressure for tougher immigration policies, governments have been constrained by the composition of immigration and by EU regulation.

Immigration didn’t cause the unemployment of EU labour markets. Public opinion has responded to budgets and austerity, as opposed to immigration. The “liberal paradox”, institutional effects constraining policy options on immigration, is in full effect.

While I think this is a supremely complex policy environment (and I find the second point difficult to comprehend), there is something to be said for dispassionate empirical analysis.

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