Does Mass Immigration Destroy Institutions? 1990s Israel As a Natural Experiment

Powell, Benjamin; Clark, J. R.; Nowrasteh, Alex

doi:10.2139/ssrn.2919469

Cited by 14 publications

(24 citation statements)

References 32 publications

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“…See De Haan et al (2006), Doucouliagos (2005), Bergh and Karlsson (2010) and Hall and Lawson (2014) for surveys of the literature. See Powell, Clark and Nowrasteh (2017) for the relation between immigration and economic freedom. Figure b is the first difference of the annual EFW scores for Guatemala and Malta, which illustrates volatility in the EFW index.…”

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confidence: 99%

The Path of Reform: The Consequences of Institutional Volatility

Bolen¹,

Williamson²

2019

Kyklos

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Summary The new institutional literature widely acknowledges the benefits of growth‐enhancing institutions but rarely discusses the path of institutional reform. While good institutions stabilize the structure of exchange and decrease uncertainty in market transactions, institutional reform may involve institutional volatility. If institutional volatility increases uncertainty, it can mitigate the benefits of reform. Using a sample of 89 countries from 2000‐2015, this paper empirically examines the effects of institutional volatility on economic growth. We find that institutional volatility decreases economic growth, particularly during liberalization for countries with low quality institutions and low income. In fact, a one standard deviation increase in volatility decreases growth by about 0.50 percentage points. This finding is robust to multiple estimation techniques and omitted variable bias. Evidence is provided suggesting that this effect is partially mediated through volatility's impact on private investment. These results support prior works that policy makers should pursue economic freedom, but our work indicates they should do so along a stable reform path to maximize economic growth.

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confidence: 99%

The Path of Reform: The Consequences of Institutional Volatility

Bolen¹,

Williamson²

2019

Kyklos

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“…Given that institutions are human-made constraints on our behaviours and operate to reduce the uncertainties and transaction costs of doing business (North, 1990), regions with higher levels of human capital may be able to strengthen the effects of local governance on firm performance. Human capital, at the regional level, is either locally built-up through education (Armen & Quinton, 2012), or externally imported through migration (Powell et al, 2017). Thus, another question emerges: which is more important for strengthening the effects of local governance on firm performance: the quality of human capital (through improvements in local education systems) or the quantity/variety of human capital (through increasing the number of migrants)?…”

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confidence: 99%

The Effects of Regional Governance, Education, and In‐Migration on Business Performance

Nguyen

Nguyen²

2019

Kyklos

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SUMMARY National institutional settings are important to small business performance. However, national institutions take time to change. So, is there any way to boost firm performance in ‘weak’ institutional environments? This study aims to answer this question by examining the role of local institutions represented by the quality of local governance, instead of the very broad national constitutional configurations. Moreover, it is suggested that regional human capital, whether locally built‐up (through local education) or externally imported (through in‐migrants) is able to strengthen the positive impacts of local governance on small business performance. A test on more than 1.3 million firm‐year observations of Vietnamese small businesses confirms the moderating effects of education and in‐migration on the relationship between local governance and firm performance.

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“…The Gap in the Predicted Error of the ICRG Index for all In-Place Placebo Donor Countries and Israel. Notes: Our donor pool matches that of Powell, Clark, and Nowrasteh (2017). The calculated p-value of the effect of mass migration on corruption in Israel is 0.250.…”

Section: Resultsmentioning

confidence: 94%

“…We utilize the same donor pool countries and Stata's "synth" command, along with the fully nested options for optimal pretreatment fit. Please seePowell, Clark, and Nowrasteh (2017) andNowrasteh, Forrester, and Blondin (forthcoming) for detailed descriptions of the synthetic control method.…”

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confidence: 99%

Cultural Baggage: Do Immigrants Import Corruption?

Pavlik¹,

Padilla²,

Powell³

2019

Southern Economic Journal

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Do immigrants undermine culture in a way that destroys productivity in destination countries? Some scholars have argued that because immigrants come from countries with dysfunctional social capital—norms and institutions—they will import it and pollute the social capital in destination countries. One potential channel through which this could occur is corruption. We examine stocks and flows of immigrants over a 20‐year time period to see if corruption increased in destination countries. We generally find that immigration is not associated with increases in corruption. Additionally, we find that immigration tends to decrease corruption in destination countries with low levels of corruption or high levels of economic freedom.

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Does Mass Immigration Destroy Institutions? 1990s Israel As a Natural Experiment

Cited by 14 publications

References 32 publications

The Path of Reform: The Consequences of Institutional Volatility

The Path of Reform: The Consequences of Institutional Volatility

The Effects of Regional Governance, Education, and In‐Migration on Business Performance

Cultural Baggage: Do Immigrants Import Corruption?

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