Heterogeneous Capital Ownership, Partial Democracy and Political Support for Immigration

Subhayu Bandyopadhyay, Devashish Mitra

Economics Bulletin, December 2024

Government

Economics Bulletin

Devashish Mitra

Abstract

This paper analyzes and compares equilibrium immigration levels of some popular political economy models in the context of unequal capital holdings.

We show that immigration rises (falls) with inequality in a limited (inclusive) democracy where only a small (large) fraction of the population has voting rights.

Furthermore, we highlight the similarities between a campaign contributions model and a partial democracy model in terms of their predictions about immigration policy.

In particular, we show that extension of voting rights in a partial democracy has qualitatively similar implications on immigration policy as reducing the relative weight on campaign contributions.