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Immigration, Public Pensions, and Heterogenous Voters

Depending on the design of the domestic pension system and the type of immigrants, voters will decide differently on immigration policy. In this paper, we investigate the voting outcome of three groups of heterogenous voters (skilled workers, unskilled workers, and retirees) under Beveridgian or Bismarckian pension systems which are either of the fixed contribution rate or the fixed replacement ratio type. We find that while the use of a Beveridge or Bismarck system does not change the results qualitatively, the fixed contribution rate vs. fixed replacement ratio distinction leads to substantial changes in the optimal choices of different groups.