## Can Immigration Solve the Demographic Dilemma? – IMF F&D ## Source details **Canonical URL:** [Can Immigration Solve the Demographic Dilemma? – IMF F&D](https://www.imf.org/en/publications/fandd/issues/2020/03/can-immigration-solve-the-demographic-dilemma-peri) ## Other formats - [Markdown version](/en/publications/fandd/issues/2020/03/can-immigration-solve-the-demographic-dilemma-peri/index.md) - [Structured JSON version](/en/publications/fandd/issues/2020/03/can-immigration-solve-the-demographic-dilemma-peri/index.json) - [Bundle manifest](/en/publications/fandd/issues/2020/03/can-immigration-solve-the-demographic-dilemma-peri/bundle-manifest.json) ## Bibliographic details - Authors: Giovanni Peri - Published: March 1, 2020 --- ### Summary of the argument - Only net immigration can ensure population stability or growth in aging, advanced economies of the North; this requires forward-looking immigration policies that allow larger numbers of immigrants and consider their long-run impact rather than focusing only on short-term political costs. - Historical trends show that between 1950 and 2010 the populations of the rich regions of the North increased through net immigration; since 1990 immigration has been the North’s primary source of population growth. - However, international migration has not automatically acted as a demographic stabilizer across countries: lacking forward-looking policy, aging societies do not systematically attract more immigrants. ### Demographic findings and key statistics - Fertility in advanced countries currently stands at 1.7 and fell below replacement around 1980. - In Europe, immigration accounted for 80 percent of the population growth between 2000 and 2018. - In North America, immigration constituted 32 percent of population growth between 2000 and 2018. - Analysis across 191 countries (fertility in 2000 versus net immigration rates 2000–2019) shows no correlation: countries with low fertility rates in 2000 did not experience higher immigration rates in the following 20 years. - Within Europe, the relationship between fertility and immigration is, if anything, positive; several lowest-fertility countries (mostly in eastern and southern Europe) experienced low immigration rates (examples cited: Hungary and Poland). - Age dependency ratio (people over 65 divided by those between 15 and 64): - United States: .126 in 1950 to .223 in 2018. - Japan: .09 in 1960 to .46 in 2018. - Rapid aging has shifted typical support ratios from about 10 working people per retiree to just 3 or 4 in a few decades in some advanced countries. ### Economic benefits of immigration - Immigrants are usually younger than natives and a larger proportion are of working age, increasing the size of the labor force and countering natural decline in advanced economies. - Increased immigration can reduce the growth of the age dependency ratio and allow a more gradual demographic transition. - Several studies find immigrants have a positive fiscal contribution over their lifetimes, conditional on labor market integration and skill alignment: - In the United States, the average lifetime fiscal contribution of an immigrant who arrived in the last 10 years has been calculated at $173,000. - Immigrants’ fertility helps sustain population levels: - United States total fertility rate of natives: 1.76 children per woman in 2017. - United States total fertility rate of immigrants: 2.18 children per woman in 2017. - From the perspective of sending countries (the South), higher migration to the North could reduce demographic pressures in high-fertility countries and generate benefits via remittances, return migration, and “brain gain.” - Emigration rates are highest in intermediate-income countries and not in the poorest ones. ### Why immigration has not automatically solved the demographic problem - For migration to act as an automatic demographic stabilizer, people would need to move from young, fast-growing populations to aging, slow-growing ones; empirical evidence shows this channel is absent. - Lack of forward-looking immigration policies and declining attractiveness of aging, economically stagnant societies limit immigration flows into low-fertility countries. - Political and social resistance: Europe and the United States have tightened immigration policies in recent years amid growing skepticism toward immigrants. ### Social and political dynamics - Aging societies appear more averse to open immigration policies; older people have systematically more negative attitudes toward immigrants than younger people (Schotte and Winkler 2014). - Paradox: older cohorts would benefit most from immigration (more sustainable pensions, less threat to jobs, services such as caregiving provided by immigrants). - Generational differences matter: surveys suggest millennials and Generation Z in Europe have more positive opinions of immigration than older generations. Greater exposure to immigration among younger cohorts may lead to more pro-immigration policy preferences as they age and gain voting power. ### Policy implications and recommendations - Promote forward-looking immigration policies that: - Allow larger numbers of immigrants, especially of working age. - Reduce constraints on immigration and plan for future inflows. - Focus on successful labor market integration and admission of sought-after skills to maximize positive fiscal and economic impacts. - Recognize that immigration will not automatically resolve demographic decline; active policy choices are required to realize demographic and economic benefits. - Consider the potential benefits to sending countries (intermediate-income countries in particular) through managed migration policies that leverage remittances, return migration, and “brain gain.” *Giovanni Peri, F&D Magazine, March 2020* --- ## Content in this bundle - **الطيور المهاجرة** - [الطيور المهاجرة (Markdown version)](/-/media/files/publications/fandd/article/2020/march/ar/peri.pdf.md){rel="alternate" type="text/markdown"} - [الطيور المهاجرة (PDF)](/-/media/files/publications/fandd/article/2020/march/ar/peri.pdf){rel="external" type="application/pdf"} - **Eastern Europe: The Future of Aging Populations and Economic Growth – IMF F&D** - [Eastern Europe: The Future of Aging Populations and Economic Growth – IMF F&D (Markdown version)](/-/media/files/publications/fandd/article/2020/march/can-immigration-solve-the-demographic-dilemma-peri.pdf.md){rel="alternate" type="text/markdown"} - [Eastern Europe: The Future of Aging Populations and Economic Growth – IMF F&D (PDF)](/-/media/files/publications/fandd/article/2020/march/can-immigration-solve-the-demographic-dilemma-peri.pdf){rel="external" type="application/pdf"} - **El canto del cisne del inmigrante ● Finanzas y Desarrollo ● Marzo de 2020** - [El canto del cisne del inmigrante ● Finanzas y Desarrollo ● Marzo de 2020 (Markdown version)](/-/media/files/publications/fandd/article/2020/march/es/puede-inmigracion-solucionar-dilema-demografico-peri.pdf.md){rel="alternate" type="text/markdown"} - [El canto del cisne del inmigrante ● Finanzas y Desarrollo ● Marzo de 2020 (PDF)](/-/media/files/publications/fandd/article/2020/march/es/puede-inmigracion-solucionar-dilema-demografico-peri.pdf){rel="external" type="application/pdf"} - **Immigrés : le chant du cygne** - [Immigrés : le chant du cygne (Markdown version)](/-/media/files/publications/fandd/article/2020/march/fr/limmigration-peut-elle-resoudre-le-dilemme-demographique-peri.pdf.md){rel="alternate" type="text/markdown"} - [Immigrés : le chant du cygne (PDF)](/-/media/files/publications/fandd/article/2020/march/fr/limmigration-peut-elle-resoudre-le-dilemme-demographique-peri.pdf){rel="external" type="application/pdf"} - **借助移民扭转乾坤？ - 金融与发展 - 国际货币基金组织季刊 -2020年3月号·第57卷·第1期** - [借助移民扭转乾坤？ - 金融与发展 - 国际货币基金组织季刊 -2020年3月号·第57卷·第1期 (Markdown version)](/-/media/files/publications/fandd/article/2020/march/zh/peri.pdf.md){rel="alternate" type="text/markdown"} - [借助移民扭转乾坤？ - 金融与发展 - 国际货币基金组织季刊 -2020年3月号·第57卷·第1期 (PDF)](/-/media/files/publications/fandd/article/2020/march/zh/peri.pdf){rel="external" type="application/pdf"} --- _Source: https://www.imf.org/en/publications/fandd/issues/2020/03/can-immigration-solve-the-demographic-dilemma-peri_