QUANTIFYING THE IMPACT OF IMMIGRATION ON THE SPANISH WELFARE STATE

Abstract

The Spanish population will experience a significant aging in the coming years. This demographic change will impose a heavy burden on the national budget. In particular, expenditure on pensions and health care will grow much faster than productivity. Some authors believe that immigration could alleviate the fiscal burden on future generations by making the Spanish population younger. We use the methodology of Generational Accounting to quantify the impact of immigration on the Spanish Welfare State, by simulating alternative scenarios according to different quotas of immigrants. Our results suggest that immigration could have a positive and significant effect.Immigration, ¿scal policy, generational accounting, Welfare State.