%0 Report
        %A Hansen, Marianne Frank
%A Schultz-Nielsen, Marie Louise
%A Tranæs, Torben
        %T The Impact of Immigrants on Public Finances: A Forecast Analysis for Denmark
        %D 2015
        %8 2015 Feb
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 8844
        %U https://www.iza.org/publications/dp8844
        %X All over Europe, ageing populations threaten nations' financial sustainability. In this paper we examine the potential of immigration to strengthen financial sustainability. We look at a particularly challenging case, namely that of Denmark, which has extensive tax-financed welfare programmes that provide a high social safety net. The analysis is based on a forecast for the entire Danish economy made using a dynamic computable general equilibrium model with overlapping generations. Net contributions to the public purse are presented both as cross-sectional figures for a long time horizon and as average individual life-cycle contributions. The main conclusion is that immigrants from richer countries have a positive fiscal impact, while immigrants from poorer countries have a large negative one. The negative effect is caused by both a weak labour market performance and early retirement in combination with the universal Danish welfare schemes.
        %K welfare benefits
%K sustainable fiscal policy
%K immigration