DP4019 Explaining Trends in UK Immigration

Author(s): Timothy J. Hatton

Publication Date: August 2003

Keyword(s): UK immigration , immigration policy

JEL(s): F20 , J60

Programme Areas: Labour Economics

Link to this Page: www.cepr.org/pubs/dps/DP4019.asp

Since the 1970s Britain has gone from being a country of net emigration to one of net immigration, with a trend increase in immigration of more than 100,000 per year. This Paper represents the first attempt to model the variations in net migration for British and for foreign citizens, across countries and over time. A simple economic model, which includes the selection effects of differing income distributions at home and abroad, largely accounts for the variations in the data. The results suggest that while improved economic performance in the UK relative to overseas has tended to increase immigration, rising UK inequality has had an even larger effect. Immigration policies at home and abroad have also increased net immigration, particularly in the 1990s.