Globalization, Migration, and Welfare State: Understanding the Macroeconomic Trifecta

✍ Scribed by Assaf Razin

• Publisher: Palgrave Macmillan
• Year: 2021
• Tongue: English
• Leaves: 213
• Category: Library

✦ Synopsis

This book is about three key dimensions in economics―globalization, migration and the welfare state―that are of enduring interest. These issues are particularly important to consider at the present moment given the strains posed by the pandemic: there is at least a temporary setback to trade-globalization and migration, and the cost of fighting the pandemic will strain the ability of governments to provide welfare state services in a style and scope to which many of their citizens have become accustomed. The book explains the changing function of the welfare state in the presence of intensified globalization, or de-globalization, forces. The welfare state’s policy-maker attitudes toward openness and migration depend on open-economy fundamentals, and the income class it represents. The author demonstrates the interactions between migration, globalization and macroeconomic policy in practice, using real-world unique episodes, with Israel deemed as well-functioning trifecta, and the US and Europe as imperfectly functioning trifecta.

✦ Table of Contents

Preface
Prologue
Contents
List of Figures
List of Tables
1 De-globalization, Crisis Driven
1 Global Crises: History
2 The Great Depression, the Global Financial Crisis and the Global Pandemic Crisis
3 US Unemployment and Output
4 Fiscal Policy: Relief and Stimulus
5 Real-Time Evidence
6 Does Financial Globalization Endure Crises?
7 Trade-Globalization in Retreat
8 Conclusion
Appendix: Israel’s Financial Integration with the World Financial Markets
2 Migration and the Welfare State: Macroeconomics
1 Literature
2 Economy-Wide Gains from Migration
3 Stylized Macroeconomic Model
3.1 Income Groups
3.2 Dependents
3.3 Immigration
3.4 Production and Investment
3.5 Saving Behavior
3.6 Capital Flows
3.7 Current Account
3.8 Policy Instruments
4 Model’s Predictions
4.1 Majority Determined Policy
4.2 Free Migration vs. Restricted Migration
4.3 “Shocks” and “Episodes”
5 Conclusion
5.1 Welfare-State Generosity and Migration
5.2 Taxation Shifts from Capital to Labor
Appendix: Simulation Model and Parameter Values
Parameters Relating to Domestic Agents
Parameters Relating to Potential Immigrants
Parameters Relating to Production Structure
Other Parameters
3 Globalization and the Welfare State: Macroeconomics
1 Introduction
2 Border Effects in International Trade
3 International Tax Competition
4 International-Finance Arbitrage: Frictions
5 Saving Propensities and Relative Labor Endowment
6 Trade Globalization and Welfare-State Policies
6.1 Capital-Abundant Economy
6.2 Labor-Abundant Economy
7 Financial Globalization
7.1 High-Saving Economy
7.2 Low-Saving Economy
8 Conclusion
Appendix: Globalization Model and Parameter Values
Cross Regime Common Parameter Values
Regime-Specific Parameter Values
4 Migration and the Welfare State at Work: Israel’s Experience
1 Introduction
2 Historical Background
2.1 Migration Waves and Growth: A Bird’s Eye View
3 Migrant Characteristics
4 Assimilation Story: Catching up
4.1 Intergenerational Mobility
4.2 Inequality
5 Immigrants and the Political System
5.1 Political-Economy Theory
5.2 Human Capital Investment
5.3 Endowments and Income Groups
5.4 Supply of Immigrants
5.5 Production and Factor Prices
5.6 Income Redistribution System
6 The Migration-Inequality Patterns
7 Conclusion
Appendix: Immigrants Who Vote vs. Immigrants Who Do Not Vote
5 Globalization at Work: Israel’s Experience
1 Introduction
2 Inflation Crisis
3 Political Shift
4 Populistic Seigniorage Finance
5 Distributive Effects of Inflation Stabilization: Explaining the Key Mechanism
6 Balance-of-Payments Crisis
7 Disinflation and Globalization
8 Flattening of the Phillips Curve and Globalization
9 Internaqtional Convergence of Inflation
10 Depression-Deflation Resistance
11 Conclusion
Appendix: Globalization and the Phillips Curve
6 Welfare State and Migration at Work: United States vs. European Union
1 Migration Policy
2 Ageing
3 Labor Mobility
4 Federal Welfare State: Coordination vs. Competition Among States
5 The Coordination-Competition Fiscal-Externality Hypothesis
Appendix: Modelling Fiscal—Externality Within the Union
Competition Regime
Coordination Regime
Epilogue
Trade Globalization: Re-trending
Corona Pandemic: Implications for Mobility
Political Economy Dimensions of the Welfare State Under Globalization
State-level Coordination vs. Competition in Federal Systems
Migration Policy: What Comes Next?
References
Index