School of Economics and Finance Brownbag Seminar Not welcome anymore: the effect of electoral incentives on the reception of refugees

Speaker: Dr Matteo Gamalerio, Institut d'Economia de Barcelona (IEB), University of Barcelona

Abstract: We explore the tradeoff between a frontline policy issue (e.g., fiscal policies) and a secondary policy issue (e.g., immigration policies) and how politicians manipulate them in response to electoral incentives. Our model shows that incumbents manipulate immigration policies for electoral reasons and that this behavior is more likely when the share of voters who feel strongly against immigration is large. However, counterintuitively, if the secondary policy affects the frontline policy, incumbents manipulate the secondary policy less when electoral competition is high. This result suggests that politicians respond more to economic concerns where electoral competition is intense. To empirically test these predictions, we exploit the localized control of the refugee reception policy by part of Italian municipalities, combined with the exogenous timing of policy decisions and staggered elections. Although municipalities receive fiscal grants for hosting refugees, the probability of opening a refugee reception center is 24 percent lower for municipalities in the final year of the electoral term (i.e., just before new elections) compared to municipalities in other years of the term. The data also confirm the comparative statics on anti-immigration voters and electoral competition.