Alberto Alesina, Elie Murard, Hillel Rapoport, 07 April 2019

A large literature shows that generosity, both public and private, is more freely extended within the same group rather than across groups. This column examines how immigration affects natives’ attitudes towards redistribution and the implications for welfare states in Europe. The main finding is that in regions which have received a larger share of immigrants, natives are in general less favourable towards redistribution. Some European countries face the dilemma of natives favouring generous welfare policies for themselves but opposing them for immigrants.

Thor Berger, Per Engzell, 28 March 2019

There are striking regional variations in economic opportunity across the US. This column proposes a historical explanation for this, showing that local levels of income equality and intergenerational mobility in the US resemble those of the European countries that current inhabitants trace their origins from. The findings point to the persistence of differences in local culture, norms, and institutions.

Joan Monras, 03 March 2019

Arguments over the effect of immigration on labour market outcomes focus on a single number: the impact on low-skill wages. The column uses a model of the adjustment process of labour markets in the US to the peso crisis of 1995 to show there is a difference between short-run and long-run effects. The model suggests that state-level policies are unlikely to be effective.

Sari Pekkala Kerr, William Kerr, 01 March 2019

Despite recent research looking at the growing contribution that immigrants make to innovation and entrepreneurship in the US, little is known about if or how the processes immigrants and natives use in this regard differ. This column uses surveys of individuals working in shared workspaces in Boston and St Louis to examine how immigrant entrepreneurs network and how their networking behaviour differs from natives.The findings suggest that immigrants take more advantage of networking opportunities at the workspaces, especially around the exchange of advice.

Simone Moriconi, Giovanni Peri, Dario Pozzoli, 24 February 2019

Firms’ offshoring decisions depend on the size of entry costs in target countries. But the institutional and policy determinants of these costs have received little empirical attention. This column uses data on 2,000 Danish manufacturing firms to explore how costs of entry affect offshoring decisions. Higher levels of labour market rigidity, credit risk, and corruption all lower the probability of offshoring to a given country, while immigrant networks within the firm increase the likelihood of offshoring to their home countries. 

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