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What Europeans really think of immigrants' impact on the economy

31 August 2005

The concerns of European citizens about the economic effect of immigration are connected more to the burden immigrants might place on public finances than their effect on the labour market, is the finding of a study that will be presented today at the 2005 World Congress of the Econometric Society, which is hosted by UCL (University College London).

Professors Christian Dustmann and Ian Preston of UCL and the Centre for Research and Analysis of Migration (CReAM) used extensive data gathered from the first European Social Survey, which includes attitudinal information from 21 European and associated countries on specific migrant and minority related issues. Their aim was to understand why people think immigrants are either harmful or beneficial to the economy.

Competition for jobs is often viewed as one of the main driving forces that shapes public attitudes to immigrants. Individuals who think immigrants will ‘steal jobs' oppose immigration while those that think the skills of immigrants will complement their own are more sympathetic. But the researchers cast doubt on the centrality of this concern.

They point out the complexity of the manner and circumstances under which immigration may benefit or harm different groups in the population. Not only may immigrants compete with the workforce, they may also have an impact on the welfare state and taxation, as well as the efficiency of the economy.

The European Social Survey was conducted in 2002 with 1,500 people, including all the EU member states, as well as seven former Soviet Bloc countries. The UCL economists designed a module of 50 questions that quizzed respondents on their attitudes towards immigration and minorities with the aim of drawing out opinions on these issues - labour market competition, fiscal burden and economic efficiency and how they related to an overall evaluation of whether immigration is good or bad for the economy. Their findings emphasise the importance of concerns about public finances.

Professor Christian Dustmann, of the UCL Department of Economics and Director of CReAM, says:

“Our findings suggest the policy the UK adopted on immigration in response to the recent enlargement of the European Union, allowing free movement of labour but imposing severe restrictions on access to welfare, are well designed to address public concerns about the economic effects.”

The research also uncovers many associations between socioeconomic and demographic circumstances of respondents and their concerns about immigrations impact on wages and employment. Those less educated, for example, were consistently less likely to be positive about the impact on wages, employment and public finances, as well as any potential efficiency gains.

Professor Christian Dustmann will present the paper, ‘Is immigration good or bad for the economy? Analysis of attitudinal responses' on Sunday 21 August 2005 between 11.15 and 12.45 BST.

For further information, please contact:

Professor Christian Dustmann
UCL Department of Economics
Mobile: 07818 048 380
Email: c.dustmann@ucl.ac.uk

Judith H Moore
UCL Media Relations Manager
Tel: +44 (0)20 7679 7678
Mobile : +44 (0) 77 333 075 96
Email: Judith.moore@ucl.ac.uk

Notes to editors:

About the World Congress of the Econometrics Society

The Econometric Society is the leading international learned society in the field of economics, and its quinquennial world congress is recognised as the most prestigious in economics. UCL is hosting the ninth Econometric Society World Congress from 18-24 August 2005, which is the first time the Congress has been held in London and has not been hosted by a UK institute for 35 years. A full copy of the programme can be accessed on the 2005 Econometric Society World Congress website: http://www.eswc2005.com/

About the UCL Department of Economics

The Chair of Political Economy at UCL was created in 1828 establishing the first Department of Economics in England . The modern department has an outstanding international reputation in key areas of current research including applied theory, microeconometrics, game theory, labour economics, development economics, macroeconomics, industrial economics and environmental economics. It is one of only four economics departments in the UK to achieve the 'double 5*' rating in the two most recent (2001) national Research Assessment Exercises (RAE).