DP2318 Immigrant Participation in Social Assistance Programs: Evidence from German Guestworkers

Author(s): Regina Riphahn
Publication Date: December 1999
Keyword(s): Assimilation, Panel Attrition, Social Assistance, Welfare
JEL(s): I38, J61
Programme Areas: Labour Economics
Link to this Page: www.cepr.org/active/publications/discussion_papers/dp.php?dpno=2318

The share of immigrants in the German social assistance program exceeds their population share and continues to grow. This study evaluates the causes of this phenomenon and tests for the effects of assimilation, cohort, age at migration, and country of origin on immigrant behaviour. It uses panel data and jointly models panel attrition, labour force status, and household social assistance dependence. Assimilation and age at migration increase the probability of social assistance dependence. In addition, the labour force status of the household head has different effects for native and immigrant welfare risks. The correction for unobserved heterogeneities in the estimation substantively affects the results.