Public finance and individual preferences over globalization strategies
By: Gordon H. Hanson, Kenneth F. Scheve, Matthew J. Slaughter.
Contributors: Scheve, Kenneth F.; Slaughter, Matthew J.; National Bureau of Economic Research.
Series: NBER working paper series ;; working paper 11028; Working paper series (National Bureau of Economic Research : Online) ;; working paper no. 11028.
Publisher: National Bureau of Economic Research
Published: 2005
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Subjects: Income tax -- United States.; Finance, Public -- United States.; Globalization -- Economic aspects -- United States.; United States -- Commercial policy.; United States -- Emigration and immigration -- Government policy.
Description: "In the absence of distortionary tax and spending policies, freer immigration and trade for a country would often be supported by similar groups thanks to similar impacts on labor income.  But government policies that redistribute income may alter the distributional politics.  In particular, immigrants may pay taxes and receive public services.  Imports, obviously, can do neither of these.  This suggests quite different political coalitions may organize around trade and immigration.  In this paper we develop a framework for examining how pre-tax and post-tax cleavages may differ across globalization strategies and also fiscal jurisdictions.  We then apply this framework to the case of individual immigration and trade preferences across U.S.  states.  We have two main findings.  First, high exposure to immigrant fiscal pressures reduces support for freer immigration among natives, especially the more-skilled.  Second, there is no public-finance variation in opinion over trade policy, consistent with the data that U.S. trade policy has negligible fiscal-policy impacts.  Public-finance concerns appear to be crucial in shaping opinions towards alternative globalization strategies"--National Bureau of Economic Research web site.
Notes: Includes bibliographical references.
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