Immigration and Government Spending in OECD Countries

This paper evaluates the fiscal effect of international migration. It first estimates a structural Vector Autoregressive model on a panel of 19 OECD countries over the period 1980-2015, in order to quantify the impact of a migration shock. Empirical results suggest that international migration had a positive impact on the economic and fiscal performance of OECD countries. It then proposes an original theoretical framework that highlights the importance of both the demographic structure and the intergenerational public transfers. Hence, OECD countries seems to have benefited from a \demographic dividend" of international migration since 1980