Abstract
Language | English |
---|---|
Pages | R22-R30 |
Number of pages | 9 |
Journal | National Institute Economic Review |
Volume | 229 |
Issue number | 1 |
Publication status | Published - 31 Aug 2014 |
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Keywords
- economic migration
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The long-term economic impact of reducing migration in the UK. / Lisenkova, Katerina; Merette, Marcel; Sanchez-Martinez, Miguel.
In: National Institute Economic Review, Vol. 229, No. 1, 31.08.2014, p. R22-R30.Research output: Contribution to journal › Article
TY - JOUR
T1 - The long-term economic impact of reducing migration in the UK
AU - Lisenkova, Katerina
AU - Merette, Marcel
AU - Sanchez-Martinez, Miguel
PY - 2014/8/31
Y1 - 2014/8/31
N2 - This paper uses an OLG-CGE model for the UK to illustrate the long-term effect of migration on the economy. We use the current Conservative Party migration target to reduce net migration from hundreds of thousands to tens of thousands†as an illustration. Achieving this target would require reducing recent net migration numbers by a factor of about 2. We undertake a simulation exercise to compare a baseline scenario, which incorporates the principal 2010-based ONS population projections, with a lower migration scenario, which assumes that net migration is reduced by around 50 per cent. The results show that such a significant reduction in net migration has strong negative effects on the economy. By 2060 the levels of both GDP and GDP per person fall by 11.0 per cent and 2.7 per cent respectively. Moreover, this policy has a significant impact on public finances. To keep the government budget balanced, the effective labour income tax rate has to be increased by 2.2 percentage points in the lower migration scenario.
AB - This paper uses an OLG-CGE model for the UK to illustrate the long-term effect of migration on the economy. We use the current Conservative Party migration target to reduce net migration from hundreds of thousands to tens of thousands†as an illustration. Achieving this target would require reducing recent net migration numbers by a factor of about 2. We undertake a simulation exercise to compare a baseline scenario, which incorporates the principal 2010-based ONS population projections, with a lower migration scenario, which assumes that net migration is reduced by around 50 per cent. The results show that such a significant reduction in net migration has strong negative effects on the economy. By 2060 the levels of both GDP and GDP per person fall by 11.0 per cent and 2.7 per cent respectively. Moreover, this policy has a significant impact on public finances. To keep the government budget balanced, the effective labour income tax rate has to be increased by 2.2 percentage points in the lower migration scenario.
KW - economic migration
UR - https://ideas.repec.org/a/sae/niesru/v229y2014i1pr22-r30.html
M3 - Article
VL - 229
SP - R22-R30
JO - National Institute Economic Review
T2 - National Institute Economic Review
JF - National Institute Economic Review
SN - 0027-9501
IS - 1
ER -