Host Steven Davis is joined by Marco Tabellini from Harvard Business School to explore the political reactions to immigration. They discuss whether economic or cultural concerns drive backlash, and how these reactions influence policy outcomes. The conversation delves into historical and contemporary issues, providing insights into the complex economic, social, and political effects of immigration. The episode closes with a tribute to the late Alberto Alesina, highlighting his contributions to the field of political economy and his lasting influence on students and colleagues.

To view the full transcript of this episode, read below:

Steven Davis: [00:00:00] Immigration is a sensitive and contentious issue. Today's show considers the political reaction to immigration. Specifically, when does immigration generate a political backlash and why? Is it because of worries about jobs and wages or is something else at work? And how does the political reaction to immigration influence policy outcomes.

These are some of the questions we'll take up in today's show. My name is Steven Davis, and this is Economics Applied. Our guest today is Marco Tabellini. He's a faculty member at Harvard Business School in the Business, Government, and Political Economy Unit. Since earning his PhD in economics from MIT in 2018, he's become a major contributor to research on the [00:01:00] political and economic effects Of immigration.

Welcome, Marco. It's great to have you on the show.

Marco Tabellini: Thank you, Steve.

It's great to be here.

Steven Davis: So Along with Alberto Alicina, you co authored a recent article in the Journal of Economic Literature titled, The Political Effects of Immigration, Culture, or Economics. We will come back to Alberto later in the show.

For now, let me ask you to state And let's go one at a time. The main lessons of the research covered in your article, because you're covering many studies, and then we'll come back later on. and, I'll ask you to share some remarks about, Alberto Alicina, but for now, what are the key lessons you think we should take about the political reactions.

to immigration from the literature that you surveyed?

Marco Tabellini: Yeah, so I think the number one lesson that, so first of all, there's [00:02:00] been a dramatic increase in the number of studies on this topic within economics. This was something that political scientists had been, interested already, before. But the number one, takeaway, I think is that very often, immigration increases natives backlash, which in turn gets reflected into, political reactions.

And there are two main mechanisms behind, this, political backlash. One is, an economic story along the lines of some of the, things you discussed, in the introduction. native workers might be worried about, the labor market impact of immigration increasing competition, they might also be worried about the fiscal impact of immigration in the sense that, immigrants might consume welfare, crowding out public goods.

And third, always related to this economic channel, is one about housing. Immigrants [00:03:00] may increase rents and house prices. The second big bucket is about what people call social tropic concerns, which are related to social and cultural, domains.

Steven Davis: Okay, so let's just, there's a lot there already, but let's parse out, flesh out what you mean by these social and cultural factors.

You listed several economic factors. But what's in the social cultural bucket?

Marco Tabellini: Yep. So this of course, is a complex, issue. you can think of, social and cultural issues being related to the fear, actual or perceived that immigration, we dilute, the national culture. So natives may be worried about, an increasing diversity and there are.

Plenty of studies that across context and not just in economics, of course, show how humans being animals, are afraid of diversity and things that are, that [00:04:00] might, alter the status quo. So immigrants are new people coming in a society and we, The natives do not know how they will, behave and thinking about between group relations how the new group will, act towards, the old one.

and so this is one of the, key points. Core issues when we think about the cultural components, there's another related, issue, which is, status competition. So when immigrants arrive, besides the economic effects, the natives may feel threatened about their status in the society as a group. And so this is more related to group theory or like group, in group and out group dynamics.

Steven Davis: But I want, to be more concrete. You used the word. The term, I don't remember if I have it exactly right, you said natives may be worried about the diversity that comes with [00:05:00] immigrants, but diversity is a vague term here. So can you be more concrete? What specifically are these concerns? And they may differ across time and space.

That's fine. But can you be more precise

Marco Tabellini: about what that means? Absolutely. So think about, Religion. Think about the way in which people socialize. So certain cultures and societies are most likely to socialize indoors through specific gatherings. Other may have outdoor barbecues, for example, and, When people are not used to see these social gatherings, they may, get anxious.

So again, I mentioned religion. This is something that historically and today has been a major, issue, but even language and other sorts of, social norms, I would say. Even, I guess the interesting thing, this is maybe [00:06:00] coming back to the lessons, is that this is not, we hear about the debate on immigration today, and sometimes we think this is special of our times.

And in fact, this is not the case, what might be special perhaps are the exact social cultural domains over which natives get worried about immigration, but it's not the first time that natives get worried about immigrants.

Steven Davis: So I hear you saying we engage each other as individuals and as groups in many different ways, socially and maybe commercially in the supermarket and so on.

And we have certain expectations about what's proper behavior or what's expected behavior. At least we have some, basis of expectation and we're on shakier grounds when we're dealing with a group that we don't know much about. So we may just be uncertain or we may dislike actively, the norms that are, embodied in some other groups, tradition and history and so on.

So [00:07:00] that's what I hear you say. Exactly. where did, okay, where do things like, concerns about crime fit into your kind of two part, two broad buckets.

Marco Tabellini: I think they, at least how economists think about them, they are not strictly speaking economic concerns. So they would be more part of social concerns, which might also be tied to culture because, and here is another interesting lesson that we learned with Alberto in this review, is that many of the Concerns and fears that natives have are formed through stereotypes and often, misperception which are fueled by news outlets or strategic politicians.

And we've heard multiple times, Today and in the past, the link between immigration and crime and the idea being that immigrants bring crime as a threat to the [00:08:00] society. And this is one of the arguments being made often.

Steven Davis: so I've read the article that I referenced earlier and that you co authored, and one One weakness that I, that it seems to me comes through in that article, which reflects, I think, the literature, I'll try to put it this way.

There's not enough allowance made for the legitimate uncertainty that people have about what both the economic and the cultural social effects of inequality are. Immigration will do. So there's multiple elements of that. First, I think the literature you can tell me if you disagree with this, but I think this comes through in the literature that the impact economic and social of immigrants varies widely across time and space.

It depends on where the immigrants come from, how they were selected in order to come into the country, how well the receiving community is prepared to assimilate or engage [00:09:00] them. So there's a lot of heterogeneity in that sense. And even among economists to this day, you're a major contributor to this literature, we're still trying to figure out what the effects of immigration are.

So it's perfectly reasonable for the average person to say, this is different. I don't know. Maybe it'll be good, but maybe it'll be not so good. I don't really know. So I'm worried. Worried for my family. Maybe I'm worried for my job. Maybe I'm just going to be discomforted when I, walk down the street.

That's, the first part of this. the second part and is, I think people can reasonably judge people who come from less educated working class, lower income backgrounds, that if things don't work out very well for with a particular immigrant group, they're going to bear the consequences disproportionately rather than the highly educated, high income [00:10:00] folks who live in wealthier neighborhoods with better securities and extreme situations that can put walls up around their properties and so on.

So I. so what I'm trying to say is even if, so I take your point, which I agree with that there are, many parties that try to manipulate fears of immigrants for their own purposes, political or otherwise, that's a serious issue that happens in the media. It happens in the social media. It happens from politicians.

The reason it's often successful is there's a kernel of truth. In the source of those fears, even if they might not turn out to be correct on average. Or in particular situations. I didn't see much attention to that in, in your survey, which I presume means there isn't much attention to it in the literature.

And I wanted to get your reaction to that.

Marco Tabellini: So this is a great point, and I agree with you. And in [00:11:00] fact, I think that some of the backlash It comes precisely because the political elite, the old political elites, let's call them that this way, have not paid attention precisely to what you said, to the idea that there is a reasonable argument for people to be worried about immigration because every time is different and you don't know exactly what the influx of people, will make to the society.

So this is something that we've been seeing in the, I'm taking the U S example, but if you think about the democratic party, I think one of the, issues that it has had within the last 20 years has precisely been this one that it has been very, open to immigration, but has not taken any to any consideration, the potential effect that this might have had, on, the [00:12:00] working class, American voter, at least in terms of what they expected to get.

And I think we're seeing now, for example, President Biden is expected to, sign a very stringent, executive order precisely in these days to, Make a U turn on what the Democratic Party platform has been. but, I agree, like now coming back to research, the problem here, is that it's very hard to know what the kernel of truth is, right?

we can't because, and I, this is one of the things I find special. What's particularly fascinating about the effects of immigration is that this is a social issue. It's an economic issue and you can measure the effects exposed on wages, productivity of firms and many other variables. How to measure the cultural and social effects of this phenomenon is much more complex.

So political scientists and increasingly economists have tried to get at this using survey data. The idea being [00:13:00] that you can look at what the effects are. natives think about immigrants, what their fears are, what their perceptions are, and you can judge what, when immigrant immigration happens, what this means for their beliefs.

Now, of course, this is tricky. One, Alberto has contributed to this in a number of studies with Stephanie Stancheva, for example, in, recently trying to, show to, people Native, individual native born individuals, different stories and different profiles of immigrants to try and understand what do people think about different immigrant groups?

What do they expect? So this is the closest I think that people have been able to get up to, and I agree, this is one of the directions that future work should definitely try to,

Steven Davis: yeah, so I think survey data approaches are useful here. as as I know, as. [00:14:00] Someone who's done survey work, the devils in the details of question formulation as well as sampling and so on.

So it's, it's It can be quite challenging to probe these issues, in a fully satisfactory way with survey data. But there are many aspects of economic research that are challenging that we learn about over time. We get better over time. And so I'm fully on board with the view that. Economists ought to get involved directly in the design of survey questions and keep iterating because there's a lot to learn about how to do it.

what I hear you say, and what I take from your survey is there hasn't yet been much effort. To directly probe, not, the first moment of what people expect, so to speak, but rather whether it's the uncertainty about the downside possibilities that drives much of their, [00:15:00] antagonism when there is antagonism, and there's not always, but when there is antagonism towards immigration, and you, reference what's been going on at the border in the United States recently, that strikes me as just one of its many aspects is.

It appears to the average person to be quite chaotic that may be overplayed in some media. But nonetheless, there would seem to be a very legitimate concern. We aren't controlling our borders in a way that prevents people with nefarious intent from entering our society and doing harm. That just amplifies these concerns about the potential downside risk.

Even if you tell somebody, 99 percent of these people just want a better life. Okay. What about the other 1 percent who are intent on doing great harm? so the way things have unfolded recently in the United States, it seems to me, amplifies, triggers the kinds of things that are likely to generate, [00:16:00] some, some worries and some antagonism.

Towards immigration.

Marco Tabellini: I agree. And when we think about, this is something we touched upon a little bit in the review with Alberto, but where I think the there is scope for a much richer set of work on is that, as you said, what are the conditions under which immigrants are When natives, because I told you, let me go back for a second at the, to the main lesson.

So I told you the main lesson is that on typically we see this backlash, but this is hides a much more complex picture. So it's not always the case. and so when it's the case and why this is, I think the most interesting question, which brings me back to the point that we were discussing, which is there are conditions that relate to social interactions and not only for under which, immigration can be, [00:17:00] or natives can react, more or less negatively or less or more or less positively to immigration.

For example, if we think about the contact theory that has been proposed in, in, in social and moral psychology, when immigrants are perceived to be a threat, when the group that arrives is perceived to be a threat, then it's much more likely. that natives are not welcoming. And, of course, so when do these threats arise when you're worried about chaos because you have the perception that the administration and your country is not ready to welcome immigrants.

Steven Davis: Articulate, what do you mean by threat in this context?

Marco Tabellini: In this context, yeah. So one threat is what you refer to of maybe the 1 percent is a criminal, but even if we know that 100 percent of the people are great people and hardworking and they just want to have a better life, there are finite resources.

And, in the short [00:18:00] run, it's impossible to immediately expand the opportunities for everyone. it's true that immigration, I think, immigration economies that are, as you said, this is a kind of divisive, issue, not only in the political arena, but even within economics. many economists think that, immigration increases the size of the pie.

So the economy grows, opportunities grow for everyone. But this isn't true. It takes some time for the economy to adjust. So if, one of the threats, when I thought about the threats, is also the size of the immigrant inflow and how suddenly this happens. So if gradually a country is able to, admit more immigrants, then the economy and the public finances definitely have under, certain circumstances have opportunity to, adjust and everyone can benefit.

But what the average citizen may be worried about is that if everyone arrives immediately, then there's no way that everyone can, be [00:19:00] better off. Okay. So

Steven Davis: there, there are several strands in the, in your remarks there, and I want to, pull them apart a bit. and treat them in isolation, with the understanding that, that they're all in play to some extent, more or less, depending on the circumstances.

One is just threat of, to your physical security and your property. So my contention is, Not just in the in immigration context, but more generally that people are much more open to engaging those in some other group, however, other is defined when they feel secure in their person and their families, physical security as well and with respect to their property.

So I view, A secure environment in the law and order sense as conducive to positive to just more interactions across different groups, but also to positive interactions, [00:20:00] they're less likely to be colored by fear and hostility. All right, so I think part of the what sets the stage. For productive engagement with immigrant groups is everybody feels safe.

And if you don't have, if you don't have that, people naturally retreat to their own families, their own groups, what they know and is familiar. I gather you agree with that. Is that? Yes, that's correct.

Marco Tabellini: That's correct. Okay.

Steven Davis: So I think of that as one of the preconditions. Of successful integration and welcoming of immigrants in the short run.

And I say that with all with the view that the United States, especially in recent years in some cities, doesn't always provide that kind of Physical environment where everybody feels safe, engaging people who are different from themselves. So that's a shortcoming in my view. You can disagree if you like in, in providing the civil foundation [00:21:00] of a community that is likely to be welcoming and open to immigrants or to anyone who's just different.

So that's the first point.

Marco Tabellini: Yes, and it's absolutely correct. And I think here, the one very complicated issue, thinking about how to implement this on the ground, is that because of this exotic kind of, Concern. We don't know what's gonna happen, even though we expect things to be okay. We're still somewhat worried, right?

We might be resistant to openly engage with the new group. And then from the perspective of the new group, what happens that you're not? You don't feel welcome. You have exactly the same thing. You don't know how to interact with the strangers. And then you have these self fulfilling prophecies whereby the immigrants are expected not to integrate, and the natives do not, [00:22:00] provide, the environment that is conducive to this assimilation or integration.

And then this is confirmed because then there are these self fulfilling prophecies and it's very hard to break these. So the initial conditions in some sense are very important. That's right.

Steven Davis: So there's the way I'd summarize it. there's both scope for virtuous circles here under the right circumstances that facilitate and encourage positive interaction, assimilation, learning across groups and so on.

But there's also ample scope, as you are pointing out. for negative cycles, negative feedback loops, vicious cycles, where each group may start out with some worries or hostility towards the other group and those become self reinforcing over time. So yeah, so it's very important to get the initial circumstances right in some sense in order to create a positive rather than negative dynamic.

Now, there's also the [00:23:00] economic aspect of the threat, which you pointed out, and you made one important point, which I'll repeat, but then I want to, introduce a separate point, which you didn't mention explicitly, but I think it's part of your thinking. You made the point about, look, in the short run, it takes time to absorb people and provide an avenue through which they can become positive contributors to the economy.

grow the pie, so to speak. And so if you have too many people coming into a community at once, it's hard to absorb them all and you just have more people fighting for the limited resources. Okay, so that's definitely a concern. And it's basically an argument for, even if you're open to immigration, at least regulating the flow.

the other aspect of this, which is important in an economic sense is if immigrants are quite different differ a lot in their capacity to contribute greatly in the short run. Versus only over time. [00:24:00] If you just to take an extreme example, if you are considering immigrants who are highly educated, already fluent in English and already highly knowledgeable about American society, they're likely to have a rather smooth entry into the American economy and do contribute, at high levels in terms of income earnings and hence what they spend.

Quickly, whereas at the other end of the spectrum, if you have people who, don't speak English very well, are not particularly well educated, don't have skills that are particularly well suited for the American economy and have very different norms and cultural values. practices, going back to what we were talking about before, those people may be able to integrate as well, but it's going to take a lot longer.

And I, so, I think we need to recognize that point as

Marco Tabellini: well. Yes. And, there is another subtle issue here, which is that, so first of all, you're totally right. And, Rana Bramitsky, from Stanford [00:25:00] and Leah Boosten have a fascinating paper on immigration in American history that make this point, which is immigration is a great thing, but You have to adopt and politicians have to adopt a medium run a generation perspective precisely because of what you said the other subtle point.

You're asking a lot of

Steven Davis: our politicians there.

Marco Tabellini: yeah, I agree. I agree. I'm not. But that's why I'm an economist and not the other thing that I think is interesting for thinking about the economic effects of immigration. But this, of course, can have been important political implications is that.

The skills of the immigrants are not exactly identical to the skills, of the natives. And so the idea, like thinking about what economy says that immigrants and natives can be complementary in production. And so the arrival of one immigrant does not displace one is not equivalent to the arrival of one new native worker.

So still, I think [00:26:00] in the long, like you can't, immediately, get. an infinite number of immigrants, even if their skills are completely different, but this might suggest that you may need less time than otherwise, if all workers were identical.

Steven Davis: Let's take a little bit of time to, to explain in non technical terms to our audience how it is that we think we know these things that you have been describing, because it's actually quite tricky in practice in this, context, at least as much as many others.

To separate correlational patterns from causal effects. how do you do that in this literature? What's, what, we're not going to get into all the details or nuances here, but what are the, some of the basic identification strategies, as economists would call it, or empirical designs, as it might be referred to more broadly in the social,

Marco Tabellini: sciences?

This is a great question, Steve. of course, we don't expect immigrants to move randomly across [00:27:00] space. That would be, you could take a helicopter and randomly drop the immigrants, and that would be the thought experiment, and then you can evaluate the effects. So to replicate as close as possible this kind of natural experiment, what economists have been doing is they've been exploiting the fact that immigrant enclaves within countries that highly persistent.

And the, newly arrived people tend to move where their friends, cousins and so on were already there. And especially for countries like the United States, where you have long time, number, many years to observe immigration, you can take the initial settlement, say, in 1900 of different immigrant groups.

And then you can ask, how does immigration affect the political or the economic landscape in 2000, 100 years later, by exploiting the arrival of the new [00:28:00] Italians, new Germans, new Mexican immigrants, and apportion them across space depending on how their ancestors settled. So this is the, has been the standard way that, economists have been using.

Of course, the number one issue, there are many issues as the discipline moved on, we realized that there are issues with this, strategy. One of these is that, The Italians settled in a specific place historically for some reasons and these same reasons may still drive both the outcomes that we want to observe and the decision of settling in a given place of the newly arrived immigrants, right?

And so this would, be a problem because we would not be able to, really talk about it. So more recently, what a number of researchers have been doing, has been to exploit what we can call natural experiments in history. For example, [00:29:00] the introduction of, major immigration policy changes. Like Rana Bramitsky and Lia Bustan that I, whose work I mentioned earlier, have been among the first to introduce this approach, looking at, the effects of the immigration acts, which changed dramatically at the national level, how many immigrants could arrive from different destinations, with the idea that Because then immigrants, are gonna, settle differentially within the country by ethnic group.

This is a trend break in the type as well as in the number of immigrants received. So this is one strategy. The other strategy, is to try and exploit the fact that there are the relative attractiveness of the, local economies. changes over time. So the, land of opportunities within the United States in 100 years ago is different from today.

And and the number of people [00:30:00] coming from different countries, 100 years ago, relative to today is different. And, you can, economists have increasingly tried to isolate these push and pull factors to get at the causal effect of immigration, in a given place. Lastly, the third strategy which has been, used and I think will be increasingly used is that of, using resettlement policies for which we know the rules of for example, refugees or, forcibly displaced individuals.

We know the rules that the government follows, or in some cases these, and these rules are often Orthogonal to many political or economic, variables that we consider. And so that is, you can exploit this random assignment.

Steven Davis: So let's just unpack a little bit of that without, again, we're not going to pretend to be exhaustive here.

So go back to the first one you described, which rests on the idea that current or recent [00:31:00] Immigration inflows tend to people naturally tend to go to where their fellow countrymen have already resided, so to speak. And maybe that's not the best way to put it. But Japanese new newly arriving Japanese immigrants and say the, I don't know, after World War Two would tend to go to where.

Japanese had previously settled. and so that would be in certain cities on the west coast predominantly. That's the idea. That's

Marco Tabellini: correct. it's in the last few years, it has been, I think the literature has gradually moved away from these. Maybe that's the most

Steven Davis: common approach, historically.

This is the most common approach, yes, absolutely. But recognizing these, weaknesses. Now, I just want to articulate a couple of issues that you didn't articulate, that arise with. At least the first two strategies you describe not maybe not the third one, which is the effects of immigration may depend on the composition, [00:32:00] the, extent to which the community in which they are immigrating already has many immigrants.

And the first, identification strategy that you described, and even the second one, automatically runs into that problem. Okay, so if Italians tend to go to where there are already lots of Italians, then the fact that there are already lots of Italians may have a profound effect on the, how easily they are to assimilate.

That then may lead to a very different outcome, at least in principle could, than the kind of, resettlement of refugees that you described in your third identification strategy. So there's a couple points to draw from this. One is the previous, the conditions of the receiving community may matter a lot for the outcome.

But second, this is one of multiple reasons why we probably shouldn't think of there being a single economic set of economic effects or [00:33:00] cultural effects associated with any immigration wave. It's going to depend on the characteristics of the receiving community. It will depend on the characteristics of where the country the immigrants came from.

It'll depend on how those immigrants were selected. When they came from that country, all these things differ across time and space. So we're articulating some of the reasons why. And you were very careful to say this. When you stated your 1st, main lesson, you said, there's often a political backlash.

You were already. And I think what you had in mind as well. Look, it depends. it depends on the circumstances, so we can go on in this vein, but what I want to leave the audience with is. There are serious minded researchers. Doing their best job to uncover the political reactions and the economic effects of immigration, but it's challenging business, even with creative minds at work and large, rich data sets.[00:34:00]

So that I think is important to understand as we carry forward the, the conversation and are just our understanding of the, what we can learn from the research. Is that fair?

Marco Tabellini: I think it's very fair. And related to this, I think we tend to forget that we economists started thinking about the economic effects of immigration way earlier than thinking about the political effects of immigration for a number of reasons.

and so we are still, the number of, Articles has dramatically increased, but it's still a young literature, if you will. And of course, being a young literature, we still have a lot to learn, both in terms of the methodology and in terms of the mechanism and unpacking these average effects, which are true on average, if they are true, but then, there are many nuances that, that I think

Steven Davis: So let's, go to some of the, I don't know whether they're nuances or just differences.

So again, we've, you opened with a carefully, careful statement that [00:35:00] allowed for differences in the political reaction to immigration, depending on the circumstances. We've come back to that many times. Why don't you flesh that out a little bit more fully? What are the main things that we think we know that govern the differences across time and space in the political reactions to immigration.

Yeah. So

Marco Tabellini: this is, the, one aspect is that, there's research showing that high skilled immigrants tend to, trigger less, political backlash as compared to unskilled immigrants. And that if you take the snapshot of the receiving population, the high skilled, native born individuals tend to be more open towards immigration as compared to, lower, educated individuals.

And this may be because of, economic reasons. And in fact, [00:36:00] many researchers, use this heterogeneity as something that, points to the importance of the economic concerns. But of course, education, and, skills are correlated, with many other, characteristics, including the perception, thinking about our earlier conversation of what should natives expect.

And when something goes wrong, how, wrong can go for people if I'm very affluent. I can, probably, pay. I'm certainly better able to pay for some of the things that go wrong, and I'm not completely

Steven Davis: protect myself. Exactly.

Marco Tabellini: Exactly. So it's easier for me to get insurance when things go wrong.

And, so this is 11 finding. The other finding is that No matter how you define culture, thinking about what our earlier [00:37:00] conversation, more political opposition when the group that arrives is culturally more different. When it speaks a very different language, when, it has a different religion, when, Phenotypically, it looks more different.

And this is something that, again, relates to this idea of we don't know. The more diverse, the more, the farther away from people's, the new group is, the, higher the uncertainty is going to be. And so this is, another important aspect.

Steven Davis: Beyond just religious differences, greater religious distance means other things equal, more resistance.

To immigration. Or, more political backlash. Can we parse it any more finely than that? Why is religion important in this respect? And how Obviously, maybe not in the academic community, but in the populace at large, religion is a very [00:38:00] important, it's a central feature of life for many people.

And, to some extent in the, in, in lives of academics as well. I don't mean to discount the role of religion. In academics, but among academics, but it's probably less pronounced there than in the population at large. So can you, what is it about the religious factor that makes it so salient in this context?

Marco Tabellini: I think because religion, is a dimension that, first of all, is tightly linked to traditions and norms and culture broadly. And because it's a, It's an instance in which people get together and, you and where the notion of community arises. And so here, I think again, this idea of the strangers, comes in and then in some societies, not everywhere, but religion is associated with specific, norms, [00:39:00] dressing norms, for example.

And these are observable. And these are, or people. have different ways of praying. And this is observable to people. And you may, as a, as someone who's not from that specific, religion, or religious order, you may find it, unsettling, that. Yeah.

Steven Davis: No, I, think that's a good point, especially about just everyday dress,

norms, norms in that respect differ greatly across cultures, sometimes, associated with differences in religious beliefs.

And some people get very offended. At seeing dress that violates their sense of propriety. So I want to, shift the conversations focus a bit. Now we've talked a lot about, the nature of the political backlash. To immigration when it arises, it doesn't always arise as you've been pointed out, and we have some understanding of the conditions under which it's more or less likely to arise, [00:40:00] but we haven't yet talked about how that plays out in the political arena.

or other kinds of policies and for the support of different kinds of political parties or political groups. So what do we know in that respect? How does this political backlash translate more broadly into policy preferences and policy outcomes beyond just immigration itself?

Marco Tabellini: This is important. So one empirical regularity, and I think it's still a puzzle, it's something that Alberto and I in the article, in the review article point out, is that if you look at the patterns Today and historically, the immigration seems to, and the anti immigrant parties tend to be associated with the right, much less so with the left.

by and large, there might be, of course, exceptions, but by and large, when anti immigrant parties, Again, we think about far right [00:41:00] or parties are definitely linked, to the right. Think about the AFD in Germany, or the brothers of Italy, in the Italian context. These are just two examples and, I don't think we have a good understanding exactly of why this is the case.

And in fact, I think it's an important question. In the article with Alberto, we speculate that this may be because the type of rhetoric that these political parties adopt, which is often centered on the idea of us versus them, resonates with voters fears of this in group, out group dimension. And The left is often, a much more diverse camp.

We're making this, we're, is an umbrella of groups itself. And so think about the United States, the Democratic Party. It's very hard to have, it's not a homogeneous group, [00:42:00] right? And, it's definitely more diverse, from, from several perspectives, than the Republican Party, for example.

And so this is one of the.

Steven Davis: Yeah, so I, I'm, I find that the pattern less puzzling than you and Alberto did for. Okay. And let me for two reasons. First, right wing parties tend to be more focused on civic order, law and order, that kind of thing. And as we've already talked about earlier, the losers to a breakdown in the civic order.

tend to be the lower income groups. So I think they're more, I think they're more attuned to rhetoric about law and order. And I'm not endorsing this rhetoric now, it's often abused. I'm just pointing out that right wing parties, that's a traditional part of their pitch. And that is, a part of their pitch that is likely to resonate more deeply when people are worried about the [00:43:00] breakdown of law and order.

And as we discussed before, It may well be that in most cases, immigrants do not bring a lot of crime, but it is a different situation. It's uncertainty in the minds of many voters. And I think the lower income folks who recognize rightly that if there is some kind of breakdown in either civic order or law and order, their physical security, they will be the ones bearing the brunt of it.

So I think that's one reason I was less puzzled. The other reason has to do with the. The support for, redistribution and social insurance, historically, it may have been the case certainly was the case in the United States that the Republican Party was less supportive of redistribution, than the Democratic Party.

That's been true for a long time through, social welfare and social insurance programs. I'm not so sure it's true anymore. Maybe it is. [00:44:00] It's, certainly that it, you don't see much, loud rhetoric coming out of the Trump camp that we're gonna cut Social Security or, anything like that.

And you can tell me I'm not a European. You, hail from, Europe. I don't. But as far as I can tell, it's the large. role for the state in redistribution is a dominant view across, maybe not the extreme right wing parties in Europe, I'm not so sure, but certainly in the center right, center left, and so on, it's such a pervasive, accepted view that Again, it doesn't seem to be the deciding factor between left and right.

for both those reasons, I didn't

Marco Tabellini: find it so puzzling. I hear what you're saying, and I see where you're coming from, and I agree. But from the, from a, let's put it this way. I think because you're already seeing the world, As we now start to understand it, namely in the political economy domain, we used to think of a world where [00:45:00] voters can be sorted on a single axis, left, based on the economic policies that they support.

And so from this angle, the support for anti immigration parties from, with their policies with this economic policies may seem puzzling to reconcile that and this is what new papers in political economy are doing. You have to add a secondary axis, which is more or less already what you said.

basically, we don't care only about this pro or anti redistribution policies. We also care about other things. And you can think of a secondary axis, not in terms of importance, but in terms of a different dimension, which is social. openness and the extent to which instead you are closed or in favor of closed society.

And so if you think of many of the policies and if you have to put on this now two dimensional space where [00:46:00] most anti immigrant parties are, I agree 100 percent with you. They may be historically right wing parties, but the economic policies they're advocating for are not the standard bread and butter, Conservative economic policy.

Steven Davis: That's in part what I'm saying. There's two dimensions, not one. But I'm also saying is that the traditional left right spectrum on that dimension, the parties just aren't that far apart anymore. They certainly aren't as far apart as they used to be. So, that becomes less salient. so, then what does this translate into?

if, Large scale immigration, which has happened in the United States many times, but recently, which has been happening at least since 2015 or so in Europe in many countries, not that they didn't have immigration before, but it's been on a very large scale, relative to their, post war historic experience.

Post World War two. if that just does generate [00:47:00] a political backlash, how is it translated into actual policy? I

Marco Tabellini: think it's gonna be translated into different policies. You're gonna probably one possibility is that, you are gonna try to change the extent to which public welfare, for example, is available to different people in the society.

You change the standards, you may decide to cut back on welfare. for example, Alberto contributed greatly to, to, to a literature that showed that when diversity in a society increases, public goods provision declines. and this is another finding that, but just

Steven Davis: remind me, I want to on that, I read one of Alberto's books on this long time ago, my recollection, but correct me if my recollection is wrong, is the variation that underlies that claim in, Alberto's earlier work is largely across countries.

Not [00:48:00] over time within countries, and that's relevant here because he's explaining why historically, Western European economies in recent decades have had a more generous social welfare safety net than the U. S. And he says the U. S. Is a more diverse society in many respects. and people are more likely to be sympathetic towards a generous social insurance programs when they identify with people.

potential recipients as being like them. And Swedes are more like other Swedes. especially before 20, the recent wave of immigration, then Americans are more like other Americans. So that was the, essence of the argument. As I recall, it's a little different in this context where you have a society, which has already got an established welfare state.

You have large number of immigrants. It's not so clear that will lead to a reversal. of the redistributionist orientation because it [00:49:00] has its own self entrenchment features.

Marco Tabellini: Absolutely. So this is true, though the literature finds that on average this diversity type of mechanism, on average, again, we can, I don't think we'll have time, but there are papers that show that this, doesn't always hold.

but on average, there is a reduction in welfare and public goods provision and preferences for distribution. So

Steven Davis: it does actually translate not just into people's policy preferences, but actual policy outcomes. Yes. That's what you're saying. That's, what the evidence suggests. Exactly. Okay. So I think that's an important lesson.

Look, I want to get something on the table that we haven't, come to, you make the point in the article, we don't need to spend a lot of time on this unless you want to, but I think it's a very important factual observation that we don't want to leave this discussion without because all of our discussion thus far is pretty much centered on rich Western economies.

we've naturally enough given where we hail from been talking mostly about the United States and [00:50:00] Europe. and there's a lot of research on the reactions to immigration in those countries, but I do not want to leave the audience with the perception Transcribed That the rest of the world is somehow more open to immigration than the, United States or Western Europe.

I think, by and large, the so called Western economies in here, I would include Australia, Canada, UK, which is sometimes considered part of Europe, sometimes considered a separate island. Those, are among the more receptive. places to immigration around the world and the more successful at assimilating and integrating immigrants over time.

So I just want to get that. I think that's a very important point to put on the table that despite all the challenges that we in the Western society space in dealing with immigration successfully, It's worse in most other parts of the world.

Marco Tabellini: Yes.

Steven Davis: Is that a fair, is that a fair characterization?

Marco Tabellini: It's [00:51:00] absolutely a fair characterization.

We, it's very hard to measure this precisely perhaps because we have this data, the very same fact that we do have data to measure immigration and the effects of immigration might already signal something about the extent to which a society is willing to accept immigration. and yes, it's, I think it's, That's definitely true what you said, that it's not a phenomenon, the political backlash is not a phenomenon just in the, Western world.

Yeah. So

Steven Davis: I just, I want to make sure that we don't, no one comes away from this conversation thinking that somehow the United States and Europe are uniquely evil in their reaction to immigration. That's not at all what the evidence suggests.

Marco Tabellini: I want to return very quickly to the idea that the extent to which you measure backlash depends on the time frame that you consider.

So in the short run, you're likely to see this backlash, but as time goes on, you may see that immigration actually may have a very different effect on people's attitudes, on people's [00:52:00] political preferences. And this is one of the things that, a number of, of papers have been, showing recently, there's a recent paper on the American economic review by Leonardo Burson, and coauthors that actually finds that in the United States, places that received more, immigrants historically or people from, from, And with ancestry of, countries from the Arab world are actually more open towards these countries and donate more money to, to these countries. So this is to say that it's true, that, in the short term there may be backlash, but going back to our idea and to what Lee and Ron say in their book, this is a generational sort of, issue.

in the long run, things are, might play out very differently now.

Steven Davis: So I. I buy that, but I buy it for the United States. Maybe for some European countries. Is that true in general? the US, the [00:53:00] story we tell about ourselves, which I think by and large is true, is that on the generational scale, we are, a society that has successfully integrated many previous waves of integration, and they contribute to our vitality and strength.

But is that true across the board? It's not so clear to me that it is in other countries. I don't know.

Marco Tabellini: I think there's a paper to be written here and, we don't know it, mostly because I imagine also for data availability, but this is a very good point that much of what we know about immigration is about, the United States.

And of course, the world is much larger than the United States.

Steven Davis: look, we know historically that, I'll just pick one example, that, Jewish members of various societies in the Middle East, often were played an important role commercially and in Europe, especially in Jews have been excluded from much of the modern Middle East, [00:54:00] in recent decades.

They were either excluded or, exterminated in much of, Central and Eastern Europe, during the middle of the, during, World War II and the lead up to World War II. So there are certainly examples of the, of societies that did. Did not reach a point of welcoming in certain immigrant groups into their national life, even when they were making, very large cultural and economic and commercial contributions.

in that sense, there is. We are. We don't need to do any careful econometric studies. We should do them. But we know just from the broad sweep of economic history that there's no guarantee that all societies reach a point where different immigrant groups are well integrated and accepted into the society.

Marco Tabellini: And I, agree, I think this is [00:55:00] true in economics in general, there's no guarantee that all economies will end up where the United States is in terms of its, technology frontier and so on.

Steven Davis: Let's close with some remarks about, your co author, Alberto Alessina. I knew him, I never had the privilege of writing with him, but he and I were rough contemporaries in the profession.

I think we entered the profession almost the same time. And, I always enjoyed my interactions with him for the audience who doesn't know him. He was a very creative mind, a prodigious researcher, certainly one of the most influential economists. Of his generation, he's often credited, I think, with considerable justification as, as the father of modern political economy, restoring, to, certainly the economics, maybe to political science as well.

Kind of the, study of the interaction between political and economic issues. He was a delightful and generous [00:56:00] man, I think beloved by his students, colleagues, and his many coauthors. I want to just give you a chance to, Tell us about your experience working with Alberto and anything else you want to share about the man.


Marco Tabellini: was, as you said, a fantastic scholar, but even before that he was a fantastic man. I had, I was lucky that, while I was doing my PhD at MIT, he was my mentor. informally and then even formally my mentor, even though he was at Harvard, his door was always open. And then when we started working on this, paper, I, learned a lot.

And, the way in which he thought about, and developed the ideas and, expanded on, on, on a simple point, was incredible. And the human qualities were, really, something unique. Just to give you an example of, what Alberto created. I think he created, besides the [00:57:00] field in economics and political economy, but a community in Boston.

We still have every year at, Susan's place, Alberto's, wife, very big gatherings of students, former students who go and would like basically 50, 60 people. This is the community that Alberto created of former students of his. who now may be assistant professors or postdocs in the area. and it's a feeling of belonging that, I think is quite unique.


Steven Davis: So thank you. when I think about Alberto as a scholar, the things that come to my mind are first, there's an expansive outlook. This is, not a narrowly specialized economist. Second, there's a willingness, indeed, an eagerness to tackle big issues that cut across. These narrow disciplines is related to his expansive outlook.

And third, there's a creativity that's, it's hard to teach. Some people have it, some people [00:58:00] don't. So I don't know, do I have it right? was that your experience in working with the co authors? He's, not the typical economist of my generation. Maybe he's more typical maybe now because he's had so much influence.

There weren't very many people. who were engaged in the style of research that I think we now associate with him, and many others. So he was a pathbreaker in that sense as well.

Marco Tabellini: One of the many, qualities he had was that he tried to transmit this and these ideas to his students. And the other thing is that he would always treat his students exactly as if they were students. his peers. And this was the, one of the best feelings that you could ever had. You are talking to Alberto Alesina and you feel comfortable.

You never feel judged precisely because he wants to discuss with you his ideas and he wants to learn from, you, your [00:59:00] ideas. So that's, that was something quite unique.

Steven Davis: Yes, he sounds like a great teacher and a great mentor. And, I, even from a distance, I miss him and his, impact on profession.

And for those of you who were fortunate to be, to work with him and, to be his students, I'm sure it's a much greater missing.

Marco Tabellini: Yeah, it's, we can feel him. But he, on the other hand, as you said, he's still, he made, created so many things and he left a big mark. Yeah.

Steven Davis: All right. thank you very much for the. Or the conversation about the political effects of immigration. I really enjoyed it. I think we covered a lot of important ground and thank you also for the remarks about Alberto. thank you very much.


Marco Tabellini is assistant professor in the Business, Government, and the International Economy unit at the Harvard Business School, and is affiliated with the National Bureau of Economic Research (NBER), the Center for Economic Policy Research (CEPR), the Centre for Research and Analysis of Migration (CReAM), and at the IZA Institute for Labor Economics.

Professor Tabellini studies the political and economic effects of immigration. His research seeks to understand what factors facilitate or hinder immigrant assimilation and how ethnic groups interact and affect society. Some of his research considers the early twentieth century US experience, characterized by the massive inflow of Europeans and the first major migration of African Americans from the rural South to the urban North. He has studied the effects of the second great migration of African Americans between 1940 and 1970, investigating how this episode contributed to the development of the Civil Rights movement.

Professor Tabellini earned his Ph.D. in Economics from the Massachusetts Institute of Technology in 2018, and spent the academic year 2018-2019 as a postdoctoral fellow at Harvard Business School before joining the faculty. He also holds a B.S. and M.S. in Economics and Social Sciences from Bocconi University.

Steven J. Davis is the Thomas W. and Susan B. Ford Senior Fellow at the Hoover Institution and senior fellow at the Stanford Institute for Economic Policy Research. He is a research associate with the National Bureau of Economic Research, consultant to the Federal Reserve Bank of Atlanta, advisor to the Monetary Authority of Singapore, past editor of the American Economic Journal: Macroeconomics, and an elected fellow of the Society of Labor Economists. He co-founded the Economic Policy Uncertainty project, the US Survey of Working Arrangements and Attitudes, the Global Survey of Working Arrangements, the Survey of Business Uncertainty, and the Stock Market Jumps project. He co-organizes the Asian Monetary Policy Forum, held annually in Singapore. Previously, Davis was on the faculty at the University of Chicago Booth School of Business, serving as both distinguished service professor and deputy dean of the faculty.


overlay image